Market Heavyweights Fuel Growth
With a boost from giants Amazon, Apple, and Tesla, the S&P 500 has rallied a recovery of 21% from its October 2022 lows. According to investors, the upward trend points to Wall Street being in the throes of a bull market. The leading voice among them, Jake Dollarhide, CEO of Longbow Asset Management, attributes growing investor confidence to the ever-widening gap since the October lows.
Tech Titans Lead the Charge
Further propelling the market, electric car maker Tesla marked a record 12 consecutive trading sessions of gains, growing 2.2%. Apple and Microsoft rose approximately 1.5% each, recording impressive year-to-date gains of 41% and 38%, respectively.
Soaring Indices and Sector Indexes
The S&P 500 climbed 0.93%, ending at 4,338.93 points. The Nasdaq and Dow Jones Industrial Average followed suit, with gains of 1.53% and 0.56%, closing at 13,461.92 points and 34,066.33 points, respectively. Of the 11 S&P 500 sector indexes, the information technology sector led the gains with a 2.07% increase.
Anticipation Builds Around Inflation and Interest Rates
The upcoming U.S. Labor Department's consumer price index reading and the Federal Reserve's interest rate decision this week have sparked anticipation among investors. Traders estimate a 76% chance that the central bank will maintain the current rates, while a rate hike in July is expected with a 71% probability, as per the CME Fedwatch tool.
Glimmers of Economic Resilience Amid Rate Hikes
The recent market rally, supported by gains in mega-cap stocks and positive quarterly earnings, is a testament to the resilient U.S. economy. Even as the Federal Reserve signals the end of its monetary tightening cycle, sectors such as energy, industrials, and small-cap stocks, traditionally more sensitive to economic conditions, have seen gains.
Notable Movers and Shakers
After its quarterly report, Oracle saw a 3.5% hike, climbing to an all-time high after J.P. Morgan revised its price target. Meanwhile, Nasdaq Inc saw a drop of 12% following the announcement of its $10.5 billion acquisition of software firm Adenza. Biogen and Broadcom were other notable players, with Biogen rising 1.5% following the backing of its Alzheimer's drug, Leqembi, and Broadcom jumping 6.3% after news of its impending EU antitrust approval for a $61 billion acquisition of cloud computing firm VMware.
Record Highs and Trading Volumes
Regarding new records, the S&P 500 posted 24 new highs and three new lows, while the Nasdaq saw 107 new highs and 68 new lows. Trading volumes on U.S. exchanges were slightly lower than average, with 10.2 billion shares traded, compared to an average of 10.6 billion shares over the past 20 sessions.