Could the S&P 500 Reach a New High This Week?
Another record high for the S&P 500
The S&P 500 (SPY) index reached another peak last week, driven by solid earnings by major US corporations. The index was at 2,472.54, with a gain of 0.54%, taking the S&P 500’s year-to-date return to an impressive 10.4%. Earnings were just one of the market movers this week—the Trump administration’s second failure at healthcare (VHT) reform relieved some uncertainty and helped the healthcare sector (XLV) post marginal gains. Falling bond yields (BND) were also positive for the financial sector (XLF). US economic data was mixed, with housing data improving due to an increase in building permits, and the Philadelphia Housing Index falling to 19.5 from 27.6 in the previous month.
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Speculators increase their bets on the S&P 500
According to the US Commodity Futures Trading Commission, in the week ended July 21, net bullish contracts of large speculators on the S&P 500 index rose to 21,761 from 18,384 contracts the previous week. It was the seventh straight week of gains in bullish positions in the S&P 500.
Another record in this week?
The S&P 500 could reach another peak this week with help from earnings and an accommodative Fed policy statement. A flood of earnings data is due this week, from giants such as Alphabet (GOOG), General Motors, Ford, Facebook, Amazon, and many other tech sector stocks (XLK). The Fed is meeting on July 26, though there are no policy changes expected this month. In the next part of this series, we’ll look at why the US dollar (UUP) remains under pressure.