S&P 500 Breaks Records But Analysts Split on Whether Rally Can Broaden

The S&P 500 hit an intraday file high of seven,844.52 on Tuesday and closed above 7,800 for the primary time. That got here a day after the 10-year Treasury yield topped 5.3%, its highest since 2002.

The S&P 500 slipped 0.3% in September, however its equal-weight model, which counts each inventory equally, fell 4.8%. Large-cap tech beneficial properties masked the weak point beneath, in accordance with Janus Henderson.

Can the S&P 500 Record High Spread to Beaten-Down Sectors?

On CNBC‘s Halftime Report, a panel of cash managers debated whether or not the rally can unfold past large tech.

Hightower Advisors’ Stephanie Link mentioned industrials, financials, utilities and supplies now supply worth. The identical Janus Henderson knowledge present financials and supplies every fell about 7% in September.

Link cited Tuesday’s 20-year nuclear power deal between Google and Constellation Energy, whose shares rose greater than 12%. She expects higher backlogs and orders for energy and grid firms.

Link additionally sees the buyer holding up, and mentioned decrease charges and oil costs would make her extra constructive.

Gilman Hill Asset Management’s Jenny Harrington mentioned the selloff hit complete sectors no matter every firm’s interest-rate publicity. Her fairness revenue technique targets a yield of 5% or extra.

Capital Wealth Planning’s Kevin Simpson mentioned broadening relies upon on power costs. Lower oil may ease inflation and stress on the Fed.

Will More Fed Hikes Stall the Rally?

Mid-September introduced the Fed’s first hike in additional than three years, and officers signaled extra would observe, CNBC reported.

Simpson, who stays defensive, argued yet another hike in December may finish the cycle if oil and inflation fall. In that case, 5.3% on the 10-year yield may show the height.

Requisite Capital Management’s Bryn Talkington mentioned expectations of a number of extra hikes would finish any broadening.

Earnings season begins in earnest subsequent week, Talkington mentioned, and he or she expects tech and power to dominate it. She estimated Nvidia and Micron will provide a 3rd of S&P 500 earnings development.

That focus leaves the broadening case dependent on revenue development exterior AI {hardware}.

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