Market Insights - Week of October 5th

# Major Indices Outlook for the Week Ahead

Welcome back to the Hobbs Trades weekly newsletter! As your go-to market analyst here at www.hobbstrades.com, I'm providing a comprehensive overview of the major indices—S&P 500, Nasdaq 100, Dow Jones, and Russell 2000—as we enter the trading week starting October 6, 2025. Last week's mixed earnings and persistent tariff rhetoric tempered gains, but the Fed's easing path kept sentiment afloat amid a jobs report that beat expectations. With Nonfarm Payrolls looming and corporate results accelerating, volatility could rise as markets balance soft-landing hopes against trade uncertainties. Broader trends lean constructive, but monitor for rotation risks in overbought conditions. Let's break it down.

## Recent Performance Recap

Major indices posted modest advances last week, buoyed by strong labor data offsetting uneven earnings. The **S&P 500** settled at 6,736.15, up 0.95% for the week, extending its rally but pausing near all-time highs on profit-taking. The **Nasdaq 100** edged higher to 24,892.34, gaining 1.32%, driven by selective tech wins amid AI hype, with YTD returns topping 22%. The **Dow Jones** climbed 0.72% to 46,592.84, supported by industrials despite tariff jitters. The **Russell 2000** gained 1.15% to 2,492.67, continuing its rotation surge but facing resistance, up 12.5% YTD on value appeal.

September wrapped positively for most, with the S&P 500 up 2.1% monthly, defying seasonality. Valuations edge higher—S&P at 23x forward earnings, Nasdaq at 28x—but anticipated 8% EPS growth in 2025 and further cuts provide cushion. Recent X buzz mixes optimism on jobs beats with caution on tariffs, traders eyeing Nasdaq pushes to 25,000 and Russell holds above 2,500, while flagging overbought signals.

## Key Price Levels for Futures

Futures consolidate post-jobs, with earnings beats and trade news as drivers. Here's what to watch for each index:

* **S&P 500 (ES Futures)**: Trading around 6,736, support near 6,700 (recent low), with cushions at 6,680–6,690 and deeper 6,650 if dips deepen. Resistance at 6,750–6,770 (recent highs), targeting 6,800 or 6,820 on positive catalysts.

* **Nasdaq 100 (NQ Futures)**: Near 24,892, support at 24,700, with 24,600–24,650 and 24,400 below. Resistance at 24,950 and 25,000 could unlock 25,200 if semis rally.

* **Dow Jones (YM Futures)**: Around 46,593, support at 46,400, with 46,200–46,300 and 45,900 as zones. Resistance at 46,650 and 46,750 may propel to 46,900 on blue-chip strength.

* **Russell 2000 (RTY Futures)**: At 2,493, support at 2,470, with 2,450–2,460 and 2,430 deeper. Resistance at 2,510 and 2,520 paves way to 2,550+ on small-cap momentum.

Breakouts above resistances could fuel extensions on earnings surprises; breaches below supports might invite corrections.

## ETF Options Chain Insights

Options trading shows guarded enthusiasm, with volume rising on October expirations (October 10, 2025) as hedges build for jobs data. Implied volatility holds at 11-16% ATM, with put skew underscoring trade worries. Key high open interest strikes:

* **SPY (S&P 500)**: Closed ~673. Calls at 675 (OI ~9,200, vol 48,000, IV ~7.0%) signal upside probes; puts at 670 (OI ~7,800, vol 35,000, IV ~9.0%) reflect caution. Slight call lean in consolidative tape.

* **QQQ (Nasdaq 100)**: Closed ~608. Calls at 610 (OI ~2,300, vol 55,000, IV ~11.0%) capture tech flows; puts at 600 (OI ~7,000, vol 42,000, IV ~13.2%) guard valuations. Put skew widens on risks.

* **DIA (Dow Jones)**: Closed ~466. Calls at 470 (OI ~4,200, vol 250, IV ~10.5%) eye cyclicals; puts at 465 (OI ~1,000, vol 600, IV ~11.8%) maintain balance. Calls modestly favored post-jobs.

* **IWM (Russell 2000)**: Closed ~249. Calls at 255 (OI ~2,000, vol 5,800, IV ~16.0%) bet on breakouts; puts at 245 (OI ~3,400, vol 4,000, IV ~18.5%) highlight sensitivity. Elevated put IV on rotation plays.

Calls hold a narrow edge, yet OTM put protection rises—primed for data-induced volatility.

## Economic Events to Watch This Week

The jobs report headlines a data-packed week, probing labor resilience amid easing. Key highlights:

* **Monday, October 6**: Consumer Credit (3:00 PM ET), consensus $12.0B. Debt trends under scrutiny.

* **Tuesday, October 7**: Trade Balance (8:30 AM ET), consensus -$67.0B; RCM/TIPP Economic Optimism (10:00 AM ET), consensus 48.5.

* **Wednesday, October 8**: FOMC Minutes (2:00 PM ET); MBA Mortgage Applications (11:00 AM ET); EIA Crude Oil Stocks (10:30 AM ET).

* **Thursday, October 9**: Initial Jobless Claims (8:30 AM ET), consensus 235K; Continuing Claims, consensus 1,937K; Fed Chair Powell Speech (12:30 PM ET).

* **Friday, October 10**: Nonfarm Payrolls (8:30 AM ET), consensus +150K; Unemployment Rate, consensus 4.2%; ISM Non-Manufacturing (10:00 AM ET).

Tariff developments simmer globally, but U.S. labor data rules—upside surprises could extend rallies, weakness stoke cut bets.

## Outlook for the Week

Fed's dovish stance sustains momentum, setting S&P 500 and Nasdaq 100 for 9-14% year-end potential on 8% EPS trajectories. Dow targets 8-9% lifts via cyclicals, as Russell 2000, with a 26% discount, eyes 2,550+ in rotations. Bullish over supports with jobs catalysts; bearish on misses or trade flares testing lows. Options tilt protected—gearing for payroll pops.