NEW YORK (AP) – U.S. stocks are rising to record highs Monday as Wall Street the momentum keeps moving that up.
The S&P 500 was 0.5% higher in afternoon trading and on track to surpass its all-time high on Wednesday. It is coming off its 10th winning week in the last 12, buoyed largely by expectations that inflation is slowing down enough to convince Federal Reserve to ease interest rates soon.
The Dow Jones Industrial Average was up 261 points, or 0.7%, also at a record pace, as of 2:36 p.m. ET, while the Nasdaq composite was 0.5% higher.
Some of the market’s best-performing areas were those that perform best when former President Donald Trump’s re-election chances look better. Trump Media and Technology Group, the company behind Trump’s Truth Social platform, jumped 36.5%. Bitcoin surged back above $63,000 after Trump, who has painted himself as one crypto-friendly candidatesurvived an attempted murder during the weekend.
Trump may take an immediate hit to his polling support, as President Ronald Reagan did in 1981, according to Isaac Boltanksy, director of policy research at BTIG, and “Trump’s skepticism after the attack may be the defining image of this election cycle.”
Yields on long-term Treasuries also rose higher than short-term ones, and the 10-year Treasury yield climbed to 4.22% from 4.19% late Friday. Something similar happened after last month DeBAte between Trump and President Joe Biden, as traders made moves in anticipation of a Republican sweep in November that could ultimately mean policies that will increase the US government debt.
Shares of major financial companies, which could benefit from a lighter regulatory touch from a Republican administration, were also helping to lead the market. JPMorgan Chase climbed 2.7% and was one of the strongest forces pushing the S&P 500 higher.
Investment bank Goldman Sachs rose 2% after the report stronger profit and revenue for the latest quarter than analysts expected. BlackRock, the asset manager behind iShares exchange-traded funds, added 0.5% after higher forecasts for profit but was a bit shy on revenue.
Expectations are generally high coming into this earnings reporting season, which unofficially kicked off last week. Analysts expect companies in the S&P 500 to grow 9.3% from a year ago, according to FactSet. That would be the strongest increase in more than two years.
Such forecasts have been one of the forces pushing US stocks to record highs. So have been the encouraging inflation reports, which have shown enough of a slowdown for much of Wall Street to expect the Federal Reserve to begin cutting its key interest rate in September.
For about a year, the Fed has kept its key interest rate at the highest level in more than two decades. Lower interest rates would relieve pressure on the economy due to the high cost of borrowing. buy a housecars, or anything else credit cards. However, Fed officials they said they want to see “more good data” on inflation before making a move.
In a speech before the Economic Club of Washington, the chairman of the Federal Reserve, Jerome Powell, said BACK on Monday he will not send any signal about when the Fed might cut interest rates. But he also said Fed officials understand the dangers of waiting too long and not waiting long enough. Cuts that are too late could push the US economy, whose growth is already slowing, into a recession, while cuts that are too aggressive could allow inflation to pick up again.
Despite the seemingly unstoppable run for the US stock market, some skeptics are staying cautious among what they see as overpriced. The S&P 500 has already jumped more than 18% this year and set an all-time high 37 times.
Barry Bannister, chief equity strategist at Stifel, acknowledged that he was at least early in his call earlier this year for an immediate “correction” in stock prices, but he is still warning of the possibility of a decline in future of 10%.
He said high inflation may remain stubborn and is also looking for slower-than-expected growth in the US economy in the second half of the year. Such a mix constitutes “moderate stagflation” and would particularly hurt the high-growth stocks that have been Wall Street’s biggest stars, according to Bannister.
On Wall Street, US-listed Burberry shares fell 16.1% after the British luxury fashion house said it has appointed Joshua Schulman, former head of Michael Kors and Coach, as its new chief executive. Schulman, 52, replaces Jonathan Akeroyd.
The surprise announcement came after Burberry said its first-quarter revenue was down 21% and suspended its dividend.
Macy’s fell 12% after ending months-long talks about a potential acquisition by two investment firms. The retailer said the firms’ latest offer was not high enough to be convincing and may also not be fully funded.
In stock markets abroad, Chinese indices were mixed afterwards China announced its economy expanded at a slower-than-expected pace in the last quarter and as the ruling Communist Party opened a once-a-decade policy meeting. Hong Kong’s Hang Seng fell 1.5%, while shares in Shanghai added 0.1%.
Stock indexes were mostly lower in Europe.
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AP Business writers Matt Ott and Elaine Kurtenbach contributed.