Wall Street closes at a record for the first time since end of January
The S&P is within spitting distance of 7,000.
Tech continues to power the market higher. The Magnificent 7 is up 8.5% in a week, up 1.6% this morning. Tesla is up 3.7%, Microsoft +3.3% this morning. NVIDIA is up 1.5%, now up 9.4% in a week. When Mega Tech runs, it drives the market-weight S&P far beyond the even-weight S&P; +3.1% in a week vs +1%. Mega Tech is not concerned about oil prices.
The strength in small caps, the Russell 2000, now up 9.4% YTD and on top of its all-time high, is also an encouraging sign of confidence in overall economic growth.
There are various estimates of when the Iran situation will be resolved, with the primary focus being on when the Strait of Hormuz will be reopened and ships will have unfettered access. Until this occurs, prices for oil and petrochemicals will remain volatile and subject to rumors and news reports. But the market has disengaged from bouncing on oil prices. Energy stocks are now down for the trailing week and month, but remain the leader by far YTD, up 25.2%.
Interest rates are creeping up modestly today. The US 10-year is up 3bps to 4.27%, fairly flat with the trailing week and month. The 2-year is also up 2bps to 3.77%, up 2bps for the trailing week and month.
After such a strong rally, we are now seeing some meaningful profit-taking. Earnings continue strong with ASML (ASML), Bank of America (BAC), and Morgan Stanley (MS) all reporting solid beats on the bottom and easily beating top line estimates.
The trend continues to be strong, though no one will be surprised if there is some resistance at old highs before the move to a new one.