S&P 500 Endures Hawkish Fed Speech Amid Strong Earnings

Nvidia's earnings report exceeded expectations last Wednesday, solidifying the AI boom as a strong force in the market. In contrast, Federal Reserve Chair Kevin Warsh's speech on Friday was more hawkish than anticipated, highlighting concerns about inflation above the Fed's 2% target.

The S&P 500 saw only a 0.5% increase for the week, with the yield curve flattening slightly as the 10-year Treasury bond yield fell 0.2bps and the 2-year Treasury yield rose 11bps. Despite the uncertainty, investors remain optimistic about the market's prospects.

The S&P 500 forward earnings per share reached a new record high at $396.05 last week, while the Magnificent-7 ETF has outperformed the Impressive-493 ETF since the start of the year. This trend may continue as investors focus on stocks with strong potential for growth.