{"id":92324,"date":"2024-07-11T02:49:47","date_gmt":"2024-07-11T02:49:47","guid":{"rendered":"https:\/\/news.talkwithrattan.com\/index.php\/2024\/07\/11\/sp-500-tops-5600-mark-in-longest-rally-this-year-times-of-india\/"},"modified":"2024-07-11T02:49:47","modified_gmt":"2024-07-11T02:49:47","slug":"sp-500-tops-5600-mark-in-longest-rally-this-year-times-of-india","status":"publish","type":"post","link":"https:\/\/news.talkwithrattan.com\/index.php\/2024\/07\/11\/sp-500-tops-5600-mark-in-longest-rally-this-year-times-of-india\/","title":{"rendered":"S&P 500 tops 5,600 mark in longest rally this year – Times of India"},"content":{"rendered":"
\"S&P<\/div>\n
A rally in the world\u2019s largest technology companies sent stocks to all-time highs, with Jerome Powell\u2019s remarks to Congress not doing much to dissuade traders from betting on Federal Reserve rate cuts this year.
For the first time in its history, the S&P 500 topped 5,600. A renewed bid for megacaps drove the US equity benchmark to its longest rally since November, with Nvidia Corp.up over 2.5% and Apple Inc. climbing on news it aims to ship 10% more new iPhones after a bumpy 2023. Treasuries remained fairly stable after a strong $39 billion sale of 10-year bonds. Swaps are pricing in two Fed cuts in 2024 \u2014 and higher chances the first comes in September.
As Wall Street geared up for the consumer-price index, Powell said the Fed doesn\u2019t need inflation below 2% before cutting rates, while adding officials still have more work to do. He noted the labor market has cooled \u201cpretty significantly.\u201d Powell cited a \u201cgood ways to go\u201d on the balance-sheet runoff, and said commercial real estate doesn\u2019t threaten financial stability.
\u201cThe key takeaway from his testimony is the Fed\u2019s assessment of the balance of risks is shifting in ways that \u2013 if supported and sustained by incoming data \u2013 will deliver a rate cut in September,\u201d said Krishna Guha at Evercore.
The S&P 500 climbed 1% \u2014 up for a seventh straight day \u2014 to notch its 37th record this year. Gold and silver mining stocks rallied on Fed easing bets. Banks underperformed. Google parent Alphabet Inc. has shelved efforts to acquire HubSpot Inc., according to people with knowledge of the matter.
US 10-year yields fell two basis points to 4.28%. Bank of England Chief Economist Huw Pill said the timing of a rate cut is still an \u201copen question,\u201d prompting traders to pare bets on August cut. Oil rose as a US holiday boosted demand for gasoline and jet fuel.
S&P 500 Sees Longest Winning Streak Since November
\u201cMarkets remain remarkably calm despite the flood of data this week, including Fed Chair Powell\u2019s testimony, CPI\/PPI reports, and the beginning of earnings season,\u201d said Mark Hackett at Nationwide.
The so-called core CPI, which excludes food and energy costs and is seen as a better measure of underlying inflation, is expected to rise 0.2% in June for a second month. That would mark the smallest back-to-back gains since August \u2014 a pace more palatable for Fed officials.
\u201cJune\u2019s CPI report looks to be another \u2018very good\u2019 report that should boost the FOMC\u2019s confidence about the inflation trajectory,\u201d said Anna Wong at Bloomberg Economics. \u201cThat should set the stage for the Fed to start cutting rates in September.\u201d
A survey conducted by 22V Research shows 55% of investors expect the market reaction Thursday\u2019s CPI to be \u201crisk-on,\u201d 16% said \u201crisk-off\u201d and 29% \u201cmixed\/negligible.\u201d
\u201cThere is optimism about inflation generally,\u201d said Dennis DeBusschere at 22V, adding that the survey also showed investors think \u201cCPI is on a Fed-friendly glide path.\u201d
Meantime, some trading desks say investors should gear up for a potential break in the eerie calm that\u2019s recently descended on the market.
The options market is betting the S&P 500 Index will move 0.8% in either direction after Thursday\u2019s report on consumer prices, based on the price of that day\u2019s at-the-money straddles, according to Stuart Kaiser, Citigroup\u2019s head of US equity trading strategy.
If it happens, that would be the biggest move for the index since June 12, the day of the last CPI print and interest-rate decision.
Market volatility may pick up in the days and weeks ahead, amid US political uncertainty, comments from the Fed chair, and the start of the second-quarter earnings season, according to Mark Haefele at UBS Global Wealth Management.
Source: Citi Global Markets
For the first time since 2022, S&P 500 earnings may not be laser-focused on just technology, with the quarter\u2019s success hanging on everything aside from the megacap tech heavyweights that have driven stocks to all-time highs, according to Bloomberg Intelligence strategists led by Gina Martin Adams.
\u201cWhile forecasts for the \u2018Magnificent Seven\u2019 remain robust, their earnings are expected to slow in the second quarter \u2014 just as the rest of the S&P 500 may finally post their first year-on-year growth in at least five quarters,\u201d they noted.
The Magnificent Seven may have already peaked, while the remaining S&P 500 stocks may post their first earnings expansion in at least six quarters, the strategists concluded.<\/p>\n
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  • Advanced Micro Devices Inc agreed to buy Silo AI for $665 million in cash, adding a maker of artificial intelligence models that will help its push to close the gap on Nvidia Corp.<\/li>\n
  • Archer-Daniels-Midland Co \u2014 working to put an accounting scandal behind it \u2014 hired a 3M Co. executive to oversee its finances and help restore its credibility with shareholders.<\/li>\n
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  • Honeywell International Inc agreed to buy Air Products and Chemicals Inc\u2019s liquefied natural gas process technology and equipment business for $1.81 billion in cash.<\/li>\n<\/ul>\n<\/div>\n<\/div>\n