SPX: S&P 500, Nasdaq Log Fourth Record Closing High This Week. Fifth One Coming?

Markets are flocking into risk assets as if they expect Fed officials to change their mind and throw in more rate cuts for the year.

• The S&P 500 and the Nasdaq Composite are making history together, walking hand in hand in the land of records for a fourth straight day. The string of record closing highs comes on the back of a powerful tech rally, falling inflation, and against a passive stance from the Federal Reserve. The broad-based S&P 500 added a modest 0.2% on Thursday and the tech-heavy Nasdaq Composite cranked higher by 0.3%.
• A few individual stocks stood out in yesterday’s rally. Tesla’s TSLA Elon Musk got the long-awaited approval of his gargantuan $56 billion pay package. The news sent the shares of the EV maker higher by 3%. But it’s not a done deal yet. Chip giant Nvidia NVDA added 3.5% on the day as the rush for AI-fueled returns showed no signs of stopping. The blue-chip Dow Jones Industrial Average tumbled 0.2% in its third drop in a row.
• Investors trifled with the most recent Federal Reserve decision, which left interest rate unchanged, in line with expectations and despite a trend showing inflation pressures are moderating. Fed policymakers now project just one reduction to borrowing costs, down from a prior projection of three. Still, markets are bidding up risk assets as if they expect central bankers to change their mind and throw in more cuts for the year.