As the curtains draw on the final trading day of the week and the first quarter (Q1) of 2024, Wall Street displayed robust resilience, propelling the S&P 500 to yet another record high. The buoyant mood on Wall Street was palpable, with the S&P 500 (^GSPC) and the Dow Jones Industrial Average (^DJI) surging over 0.1% on Thursday, while the Nasdaq Composite (^IXIC) experienced a slight dip of about 0.1%.
This marks the fifth consecutive month of gains for all three major indices, signifying a remarkable start to the year. The S&P 500’s stellar performance, boasting a more than 10% return in the first quarter, represents its strongest showing for the initial three months since 2019.
Initially propelled by a surge in megacap stocks, the market rally has demonstrated signs of broadening, encompassing a wider array of sectors. This expansion has left Wall Street analysts struggling to keep up with the relentless ascent of the S&P 500, prompting many to revise their year-end price targets upwards.
Bolstering investor sentiment, the final reading on fourth-quarter GDP released on Thursday revealed that the US economy expanded at a rate of 3.4%, exceeding the previous estimate of 3.2%. Additionally, initial jobless claims for the preceding week came in at 210,000, slightly lower than the anticipated 212,000, underscoring the ongoing strength of the labor market.
While the stock market takes a pause for the Good Friday holiday, investors remain poised for the release of the Personal Consumption Expenditures (PCE) price index, a key data point that includes the Federal Reserve’s preferred “core” PCE inflation measure. The outcome of this report will provide valuable insights into the trajectory of inflation, a crucial factor influencing the central bank’s monetary policy decisions.
As Q1 comes to an end, the resilience of Wall Street and upward momentum has ignited optimism among investors. While uncertainties persist, particularly surrounding inflation and geopolitical tensions, the market’s strong performance thus far instills confidence in the resilience of the US economy and its ability to weather challenges on the horizon.
