S&P 500 hits new record as technology rally pushes stocks higher
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Wall Street stocks hit an all-time high on Friday, with strong gains for large technology companies finally pushing the main US equity benchmark to a new record after a shaky start to the year.
The S&P 500 index rose 1.2 per cent to close at 4,839.81, overtaking a previous record set on January 3, 2022. Its intraday value also reached a fresh high of 4,842.07 during the trading session.
The S&P had been within touching distance of the records for a month, after a blistering rally at the end of 2023.
However, markets have lost momentum since the turn of the year, as disappointing economic data damped optimism about how quickly the US Federal Reserve will start cutting interest rates. Even after Friday’s rise, the S&P is up just 1.5 per cent in January, compared with a 16 per cent rally over nine consecutive weeks of gains from late October.
Several investors said they expect markets would continue to be choppy, but were optimistic that they would trend upward in the coming months.
“If the economy continues to grow — which we expect it will — and if inflation continues to trend down, that should be quite good for the average stock,” said Jeff Mills, chief investment strategist at Bessemer Trust.
“You may not have another 20 or 25 per cent increase [in the index], but it’s an environment that will allow earnings to shine through and slowly push the market higher for what could be another solid year.”
The Nasdaq Composite, which is dominated by tech stocks, has also risen almost 20 per cent since late October, but would need to gain a further 5 per cent to surpass its record closing level.
The bulk of the rally since October was driven by changing rate expectations, as investors bet that falling inflation would allow the Fed to start cutting rates. Lower interest rates tend to boost stocks by reducing the appeal of lower-risk assets such as…
2024-01-19 16:19:56
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