The S&P 500 has hit four new all-time highs in as many days. Wednesday’s rally ran into a bit of trouble late in the day, which saw the major indexes give back all or most of their earlier gains.
Index futures have been stable so far, despite Tesla's (NASDAQ:TSLA) underwhelming earnings that took some shine off the tech euphoria.
The electric carmaker warned of “notably lower” sales growth before the launch of the new model next year.
Investors will be eyeing the ECB rate decision, as well as a slew of US data that includes GDP ahead of next week’s Fed meeting.
The key question is whether Wednesday marked at least a temporary top in this current phase of the rally, or do we just continue plowing ahead despite concerns over valuations, the Red Sea situation, and the delay in interest rate cuts?
Tesla aside, we had seen some good earnings, especially Netflix (NASDAQ:NFLX), while the Composite PMI of the manufacturing and services sector rose to its highest level since June.
This added to a string of forecast-beating data we have seen lately.
Among other US data releases that have beaten expectations lately include retail sales and jobless claims falling to their lowest level in more than a year.
The UoM’s consumer confidence survey rose sharply to 78.8 from 69.7. On top of this, China’s latest efforts to shore up its struggling equity markets also boosted investor confidence.
Following the dovish rate-cut euphoria that propelled stocks to record highs in the last month of 2023, you would have thought the start of 2024 might see the markets stage a bit of a correction.
Expectations over the Fed’s rate cuts have been pushed back.
We did get a tiny correction in the first week of the year, but then the markets continued to
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