The 2023 stock market rally entered a healthier phase over the past month. The recent gains aren’t just about seven big tech stocks, as financials and small-cap stocks alike soar on optimism about the Fed’s shift.
Research by Morgan Stanley Chief Investment Officer Mike Wilson shows that 78% of investors last weekS&P 500 IndexThe stock is trading above its 200-day moving average, which is in line with this year’s highest levels.
Wilson wrote in a report on Monday (18th): “Over the past month, we have arguably experienced the best market breadth improvement in 2023.”
The Wall Street short strategist described the expansion as “an encouraging sign,” representing market breadth that many have been skeptical about.S&P 500 Index The key sticking point for the 2023 rally.
Many pointed to gains in 7 big tech stocks: Apple (AAPL-US)、Alphabet (GOOGL-US), Microsoft (MSFT-US), Amazon (AMZN-US)、Meta (META-US), Tesla (TSLA-US) and Nvidia (NVDA-US) maintains its benchmark average for much of the year.
Liz Ann Sonders, chief investment strategist at Charles Schwab, compared the rise of the “Big Seven” to an army in early October.These stocks are like leading generals, but with “soldiers” orS&P 500 IndexThe rally is not considered strong until other stocks join the front line.
But now, withS&P 500 IndexApproaching all-time highs again, the Generals have driven support.
Analysis shows that last monthS&P 500 IndexThe biggest increase was at Bath & Body Works (BBWI-US)、Illumina (ILMN-US) and Norwegian Cruise Line (NCLH-US), with increases exceeding 35%.
Meanwhile, none of the “Big Seven” rose more than 8% last month. Tesla is in the lead, up about 7.9% during the period.But since November 17, withS&P 500 IndexComparing the constituent stocks, the gains barely ranked among the top half.
Gordon, senior investment strategist at Charles Schwab, said the market rebound has become healthier and “expanded.” The Russell 2000 index rose nearly 15% last month.
“There’s a lot of debate about whether this is a sustained bull market,” Gordon noted. “So far, that’s not the case. But now you’re finally starting to get some action from small caps, which is what you normally would in a bull market.” have witnessed.”
He pointed out that this statement had appeared in the market this year, but was proven wrong in late summer. But Gordon believes the second chance to extend the rally could be different.
The key will be the continuation of current trends, which have shifted away from leading industries such as technology, communications services and consumer discretionary in 2023 towards areas such as financials, industrials and real estate.
This has been borne out by the market’s surge over the past month, with stocks in the latter three sectors trading atS&P 500 IndexThe highest increase among them. If this continues and the “Big Seven” don’t fall off a cliff, then the market rally may have reached “nirvana.”
“We’ll see if it actually pans out,” Gordon said. “But I think if the signals that the market has sent over the past month are credible and they continue, then that tells me that the economy is going to be much better next year.”
2023-12-19 11:17:23
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