The S&P 500 and the Nasdaq 100 posted an eighth day of gains yesterday, and though not all these moves higher could be described as “earth-shattering”, cumulatively they account for a 5.43% rise in the global equity benchmark. Thoughts of a US recession seem to have been swept away and the calls in early August for emergency rate cuts from the Federal Reserve now sound increasingly hollow.
The S&P 500's price action during yesterday's session was bullish, with the index finishing just a fraction of a point below the day's high. The information technology, communication services and consumer discretionary sectors finished at highs for the day. Energy and consumer staples were the only laggards.
There were more than 2,500 new five-day highs posted across all US equity markets yesterday and advancing issues outnumbered decliners by at least 4:1. Some 90% of S&P 500 stocks are now trading above their five-day moving average (DMA), while 56% are above their 50-DMA. It's a similar story in the Nasdaq 100, with 93% of stocks trading above the five-DMA and 60% above the 50-DMA.
Large-cap movers include Alcoa, which added 5.85% on the session, Korean online retailer Coupang, which rallied by 5.08%, buy-now-pay-later service provider Affirm Holdings, which was up by 6.64%, and media streamer Roku, which finished the day up by 5.77%. Despite the largely bullish noises on an index and sector level in the US yesterday, there were losers. Icahn Enterprises was down by 4.71% on news that the SEC had fined the company over a series of undisclosed stock-backed loans.
Major European equity indices were all up on the day. Iberia took the lead, with the Spanish IBEX adding 1.4%. The IBEX is up by 4.3% on the week as of yesterday's close, though that performance is matched by the EuroSTOXX 50. Telecom Italia added 4.3%; the group appears to be in transition and recently sold its remaining stake in tower operator INWIT for €250m, and last month it disposed of its fixed-line business to private equity giant KKR.
Steelmaker ThyssenKrupp AG added 3.6% yesterday, though that gain hardly dents the 48.6% year-to-date loss seen in the company's share price. Iron ore and steel prices have been under pressure from a sluggish Chinese economy. However, steel prices have perked up in European trading, rallying by as much as 6% this morning. Aviva posted a 52-week high yesterday as did Lloyd’s broker Beazley and grocer Tesco.
Gold tested new highs in yesterday's session and opened above $2,500 per ounce this morning. The Vaneck Gold Miners ETF added 1.9% yesterday but remained below its recent one-month high of $39.25. Oil is trading lower in Europe, with Brent and WTI off by 0.88%. Oil prices have lost at least 6.5% over the last month and more than 8% over the last year.
The Nikkei was up again overnight and European markets have taken their cues from Asia to trade modestly higher, the exception being the FTSE 100 which is down by 0.36% at the time of writing.
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