As tech stocks recently returned to market gains, the S&P 500 hit a new closing high on Thursday as investor sentiment reached its most bullish level in more than three years, a sign that Wall Street may overcome. his fears that a rise in interest rates could tank the market.
The S&P 500 climbed 0.4% on Thursday, closing at a new record for the third day in a row.
Meanwhile, the Dow Jones Industrial Average, which tracks prices for 30 market leaders including Walt Disney, Nike and Goldman Sachs, rose about 0.2%, ending the day below 0.1% d ‘a Monday record.
Tech stocks outperformed the market as a whole on Thursday, with the tech-heavy Nasdaq climbing nearly 1% as PayPal, Intuit and Autodesk jumped about 3% each.
Big tech has also rebounded: Salesforce, Twitter and Apple all added between 2% and 3% as ten-year Treasury yields, which have climbed this year and scared investors away from high-priced stocks, fell. at their lowest levels in nearly two. weeks.
The rise comes as bullish investor sentiment reached 57% last week, according to the American Association of Individual Investors’ weekly survey, which is the most euphoric level since December 2017, when energy stocks led. the market to new heights.
Despite the stock market rally, new jobless claims rose more than economists feared last week, totaling 744,000 and climbing 2% from the previous week as layoffs continued, despite signs that the recovery is progressing in other areas of the economy.
Billions of dollars in fiscal stimulus, accommodative monetary policy and exploding corporate profits fueled huge gains for the stock market during the pandemic, and the Federal Reserve said on Wednesday night it would not relax its support unprecedented economic even if the market is doing well. on the way to a full recovery. Fed officials have confirmed they will not stop buying back more than $ 100 billion in distressed assets each month until the labor market reaches its employment peak and inflation subsides. stabilizes at more than 2%. Meanwhile, billionaire JPMorgan’s CEO Jamie Dimon applauded the market rally on Wednesday morning, saying the US economy “is likely to explode” in 2023 thanks to excess savings, increased spending. policies and the Fed’s accommodative policy.
“All of the forces that have propelled stocks higher for months are not only remaining in place, some are strengthening,” Vital Knowledge Media founder Adam Crisafulli said in a note Thursday. “Reopening alone would be enough to fuel a healthy economy for the next few quarters, but an unprecedented wave of fiscal and monetary stimulus is boosting the recovery.”
“The rise in jobless claims is disappointing, but does not change our view that the next few months will see huge job gains as the economy continues to reopen,” said Jeff Buchbinder, equity strategist at LPL Financial, in an email Thursday, adding that it would not be shocked to see employment return to pre-pandemic levels by the end of this year, echoing the expectations of analysts at Bank of America, who predicted last week that the labor market should recover before the end of the year if current trends continue.
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