U.S. stocks bull run

S&P 500 and Nasdaq up to new record highs again

Investors appear less worried by inflation and interest rates… for the moment

S&P 500 & Nasdaq set new record highs

The S&P 500 rose on Friday and again Monday building on its rally to reach record highs, as investors ‘bet’ that higher inflation will be temporary as the economy continues to recover from the pandemic. Successful U.S. bank stress tests helped sentiment as dividends and share buy backs returned.

The S&P 500 climbed 0.3% to hit another closing record high of 4,281 and again on Monday to a new high of: 4290. Financials were the best performing S&P 500 sector with a 1.3% gain. The 10 year U.S. Treasury yield jumped 4 basis points to 1.52%.

The S&P 500 rallied 2.7% for the week ending Friday, notching its largest weekly gain since February. The Dow gained 3.4% this week for its best week since March.

Nasdaq at a new record high

The Nasdaq index enjoyed a profitable day closing at: 14500 – another new high as tech returns to favour after a period of neglect. Cathie Wood’s Ark fund recovered much of its recent losses.

Apple and Salesforce increased value by more than 1%. Facebook jumped more than 4% after a U.S. federal court dismissed an antitrust case aiding a valuation gain exceeding £1 trillion. Nvidia gained 5% and Broadcom climbed more than 2%.

Inflation

Friday’s rally came after a key inflation indicator used by the Fed rose 3.4% in May 2021, the fastest increase since the 1990’s. The core index rose 0.5% for the month, which actually was below the 0.6% estimate. Investors and traders appear more than content with the Feds version of inflation despite reaching 3.4% breaking records and the Fed’s target at the same time.

But is this bout of inflationary pressure transitory as the Fed lead to believe? I guess,as long as money can be made from spinning good or bad news – it simply doesn’t matter.

But it will…eventually. Enjoy the good times while they last.

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