Key Highlights

● The Nasdaq Composite fell 694 points to 26,008.86, its steepest drop since June 5.

● The Dow Jones Industrial Average edged up 11.89 points to 52,867.98.

● Brent crude settled at $113.17, its highest since May 4.

● Initial jobless claims fell to 194,000, the fewest in about three months.

Wall Street heads into Friday, October 23, after a lopsided session. On Thursday, the Nasdaq Composite fell 694 points to 26,008.86, its steepest drop since June 5, while the S&P 500 slid 93.74 points to 7,663.43, its worst day since July. The Dow Jones Industrial Average, by contrast, edged up 11.89 points to 52,867.98.

The final trading day of the week offers three things to watch: purchasing managers' surveys, the University of Michigan's consumer sentiment reading, and earnings from American Express (NYSE:AXP) and Illinois Tool Works (NYSE:ITW).

S&P Global PMIs

S&P Global's flash purchasing managers' indexes give an early look at October activity in manufacturing and services. Readings above 50 signal expansion and below 50 signal contraction. The surveys also include gauges of prices paid and employment.

Those price components will get extra attention this month. Brent crude settled Thursday at $113.17, its highest since May 4, and companies have been flagging higher costs. Procter & Gamble (NYSE:PG) executives said "Oil at $113 means more is coming in Q3 and Q4," and Southwest Airlines (NYSE:LUV) cut its 2026 profit forecast on fuel.

University of Michigan sentiment

The final October reading of the University of Michigan's consumer sentiment survey is also due. It measures how households feel about their finances and the economy and includes closely watched inflation expectations.

Recent signals on consumers have been mixed. P&G's CFO Andre Schulten called the US consumer "remarkably resilient," while PulteGroup (NYSE:PHM) CEO Ryan Marshall cited high mortgage rates and inflation as weighing on entry-level home buyers. The labor market remains firm, with initial jobless claims falling to 194,000 on Thursday, the fewest in about three months.

American Express and Illinois Tool Works

American Express offers a read on spending by affluent consumers and businesses, from travel to dining. Its results will be scrutinized for signs of whether higher fuel and airfares are changing behavior.

Illinois Tool Works, a diversified industrial maker of everything from welding equipment to food-service machinery, is a bellwether for factory demand. Industrial results on Thursday were mixed: Dover (NYSE:DOV) reported before the open, Graco (NYSE:GGG) and Hexcel (NYSE:HXL) fell after missing estimates, while Union Pacific (NYSE:UNP) and CSX (NASDAQ:CSX) rallied on strong freight volumes.

The backdrop

Friday's data lands on a market grappling with an artificial-intelligence spending scare. Meta Platforms (NASDAQ:META) shares fell after the company laid out heavy capital spending, and Lam Research (NASDAQ:LRCX) led chip stocks lower after citing supply constraints. Nvidia (NASDAQ:NVDA) was the single biggest drag on the S&P 500.

At the same time, money rotated into consumer staples, health care, utilities and homebuilders. About two of every three S&P 500 stocks rose, according to market data. Treasuries rallied, and the 10-year yield closed back below a closely watched threshold for the first time since September 22.

Evening futures pointed to a calmer open. At 8:10 pm ET Thursday, S&P 500 futures were roughly flat at 7,707.0, while Nasdaq-100 futures edged lower.

Fed Week and Saturday's Melanoma Data

Beyond Friday, the calendar fills up fast. Moderna (NASDAQ:MRNA)'s full melanoma vaccine data is due Saturday at the ESMO conference. The Federal Reserve, led by Chair Kevin Warsh, announces its decision on Wednesday, October 28, the same day Microsoft (NASDAQ:MSFT), Alphabet (NASDAQ:GOOGL) and ServiceNow (NYSE:NOW) report. Third-quarter GDP, September PCE inflation and results from Amazon (NASDAQ:AMZN), Intel (NASDAQ:INTC) and Caterpillar (NYSE:CAT) follow on October 29. Investors will also watch oil, which remains sensitive to events in Saudi Arabia and Iran.