S&P 500 sees best three-day rally since November
Stocks saw their best three-day rally since November, fueled by speculation the Federal Reserve will be able to cut interest rates this year.
The S&P 500 rose 1% after topping its average price of the past 50 days — a level seen by many chartists as key in maintaining the positive sentiment. A solid earnings season kept driving optimism after a pullback that made some areas of the market attractive. While the below-average trading volume raised concern about the sustainability of the advance, most industries gained.
“Bulls will be looking to maintain their momentum after snatching last week from the jaws of bears,” according to Chris Larkin at E*Trade from Morgan Stanley. “This week is light on high-profile economic data, but heavy on Fed members hitting the speaking circuit. Traders will be dissecting any comments they make about potential rate cuts.”
The US equity benchmark rose above 5,180. Nvidia Corp. and Tesla Inc. paced gains in megacaps. Micron Technology Inc. jumped on an analyst upgrade. Apple Inc. fell, with Warren Buffett revealing he’d cut his stake even after heaping praise on the iPhone maker. Treasury 10-year yields slid two basis points to 4.49%.
Traders also kept an eye on the latest geopolitical developments, with Israel rejecting a statement from Hamas that it had accepted a cease-fire proposal to end the fighting in Gaza. Oil closed higher.
Following Jerome Powell’s not-very-hawkish tone last Wednesday, investors waded through remarks from some of the many Fed officials due to speak this week.
Fed Bank of Richmond President Thomas Barkin said he expects high rates to slow the economy further and cool inflation to the 2% target. His New York counterpart John Williams said eventually there will be rate
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