Market Ignores Wars, Weather, Politics and Higher Interest Rates

The market continued to plod steadily higher on Wednesday, with the S&P 500 hitting a new all-time high. Big-cap technology stocks and the DJIA were leaders, while small-caps lagged. Breadth was mediocre, with just 5,100 gainers to 4,200 losers.

It is a very peculiar market without an obvious news catalyst. The positive momentum is feeding on itself, but many market players are puzzled about why the action is so strong. 

Personally, the hurricanes in North Carolina and Florida have impacted some of my family members and are causing some stress, which prevents me from feeling more optimistic. There are a lot of negatives out there, including wars, weather, and politics, but they don’t seem to matter to buyers right now.

Another thing the market bulls appear to be ignoring is weakness in bonds and higher interest rates. The market is only expecting two quarter-point cuts later this year, but that is also being ignored.

CPI in the morning could shake things up, and if that doesn’t, then we have weekly unemployment claims, PPI, and the start of earnings season that could generate a reaction.

I’m not sure if market players are complacent or just not paying very close attention, but it is awfully hard to trust this market to keep on running higher.

Have a good evening. I’ll see you in the morning.

At the time of publication, Rev Shark had no positions in any securities mentioned.