S&P 500 Has Started A New Bull Market Run

June 9, 2023

minute read

On Thursday, U.S. stocks experienced a positive trajectory, signaling the end of the S&P 500's longest bear market since the 1940s and the beginning of a new bull run.

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The notable gains of a few key companies played a significant role in propelling the broad index higher in recent months. This trend continued as stocks like Amazon.com, Tesla, and chip maker Nvidia led the market's upward movement on Thursday.

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Consequently, the S&P 500 surged by 0.6%, reaching a level 20% higher than its low point in October. The Nasdaq Composite also climbed 1%, while the Dow Jones Industrial Average rose by 0.5% to 33,833.

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Meanwhile, Treasury yields experienced a retreat, with the benchmark 10-year Treasury note yielding 3.714%, down from 3.782% the previous day. Bond prices rose as yields fell.

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Market analysts attributed the relative calm to traders adopting a wait-and-see approach ahead of significant events scheduled for the following week. The Bureau of Labor Statistics would release fresh inflation data on Tuesday, and the Federal Reserve would announce its latest interest-rate decision on Wednesday.

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Presently, futures markets indicate that many traders anticipate the Fed will maintain interest rates unchanged in June. While this may provide temporary relief to the markets, investors caution that there could still be future tightening of monetary policy.

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Tim Courtney, Chief Investment Officer at Exencial Wealth Advisors, emphasized that a pause in rate hikes should not be misconstrued as the end of such actions by the Fed.

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Traders anticipate potential increases in volatility in the coming months. Large options contracts tied to the Cboe Volatility Index, commonly referred to as Wall Street's "fear gauge," indicate wagers that the index will surge to either 30—a level associated with investor anxiety—or 60, a level witnessed only during severe stock-market crashes.

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In terms of individual stocks, electric-car maker Tesla saw a significant jump of 4.6% to $234.86, marking its 10th consecutive session of gains. This streak represents Tesla's longest winning run since January 2021, as per Dow Jones Market Data.

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Additionally, online used car retailer Carvana experienced a notable increase of 56% to $24.23 after announcing expectations of a substantial profit jump in the second quarter.

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