After a rocky start to the year, Wall Street stocks reached an all-time high on Friday, driven by robust gains for huge technology companies that ultimately helped the main US equity index to a new record.
The S&P 500 index broke the previous high set on January 3, 2022, closing at 4,839.81, up 1.2%. During the trading session, its intraday value also touched a new high of 4,842.07.
Another rise in the S&P 500’s most prominent sector, technology, pushed the gauge to a new high for the first time in two years. Fueled by optimism that the artificial intelligence boom will continue to drive the market higher, the benchmark surpassed 4,800, despite warnings that the advance is concentrated in a smaller number of stocks.
Equities rose on Friday, as a decline in Treasury volatility boosted risk-taking on Wall Street. A report viewed by many as “Fed-friendly,” indicating a mix of strong consumer confidence and lower inflation forecasts, also helped sentiment.
The increase was fueled in large part by predictions that inflation would continue to fall. The study indicated that respondents expect prices to rise at an annual pace of 2.9% over the next year, down from 3.1% in December. Expectations for price increases over the next five to ten years fell to a four-month low of 2.8%.
Consumers have frequently reported feeling pessimistic about the economy after the epidemic ended. These statistics have come while unemployment approaches a 50-year low, stock markets have risen, and the overall economy has remained robust.
The divergence has perplexed economists and left the Biden administration with a huge quandary ahead of the 2024 election. Joe Biden has made “Bidenomics,” his economic recovery agenda, a key component of his re-election campaign. However, studies reveal that voters have shown little excitement thus far.
Jared Bernstein, chairman of the White House Council of Economic Advisers, praised the study as evidence that Biden’s programs are effective.
“We have more work to do, but we’re on the right path as we execute President Biden’s agenda, and people are starting to feel it,” Mr. Bernstein said. “That’s a sharp contrast with congressional Republicans’ plans to cut taxes for the wealthy and big corporations while raising healthcare and prescription drug costs for hard-working American families.”
The Michigan study is the most recent in a series indicating that the national mood may be changing. According to a study issued earlier this month by the Federal Reserve Bank of New York, people anticipate inflation to fall in the short, medium, and long term, but perceptions concerning credit access and household financial situations have improved.
The Conference Board said in December that 2023 concluded with a sharp increase in consumer confidence. The highly followed consumer confidence poll by the research agency increased to levels not seen since July.
