Q3 Earnings Start Mixed as Services Activity Slumps

The first full week of the third-quarter earnings season concluded on Friday, October 16, 2026, with results described as somewhat mixed. Sheraz Mian, Zacks Director of Research, noted in his Earnings Trends release that early Q3 reports are tracking modestly below recent quarters for the same period. Pre-market futures showed slight divergence, with the Dow Jones Industrial Average up 27 points and the Nasdaq Composite down 42 points. The S&P 500 gained 11 points, while the Russell 2000 added 4 points.

Economic data released by the U.S. Bureau of Labor Statistics indicated that September import prices rose 1.1%, exceeding the expected 0.8% and more than double the previous month's revised 0.5%. Excluding fuel, the rate stood at 0.8%, still higher than anticipated. Year-over-year, import prices increased 8.1%, marking the most expensive month since July 2022. Exports rose 2.2% in September, up from 1.2% in August, with year-over-year growth reaching 11.6%.

The Federal Reserve Bank of New York reported an October Services Index of -20.7, significantly below the expected -4.1 and the lowest level since March. This figure follows September's print of -8.7 and reflects rapid selling price declines driven by weaker capital expenditure spending. The report also cited a pessimistic outlook for the New York, New Jersey, and Connecticut area, contrasting with the robust +25.5 reading in the Empire State manufacturing report from earlier in the week.

Dow component The Travelers Companies, Inc. (TRV) reported a third-quarter earnings surprise of +29.84%, posting $9.18 per share against an expected $7.07. Revenue reached $12.45 billion, slightly above consensus and nearly flat year-over-year. Despite the beat, TRV shares fell 3% in pre-market trading, giving back some of their year-to-date gains of 32%. Regional banks Regions Financial Corporation (RF), Citizens Financial Group, Inc. (CFG), and M&T Bank Corporation (MTB) also beat earnings estimates by +8.96%, +2.17%, and +2.01%, respectively. Only Regions Financial shares rose in pre-market trading, gaining 1.2%.

Earnings season is set to accelerate next week with reports from major technology and industrial firms. Netflix, Inc. (NFLX), which announced that entertainment executive Peter Rice will replace Chief Content Officer Bela Bajaria, is scheduled to report after Tuesday's close alongside Tesla, Inc. (TSLA). On Thursday, Meta Platforms, Inc. (META), General Motors Company (GM), and Intuitive Surgical, Inc. (ISRG) will release their third-quarter results.