US Stocks Rally on Tech Rebound, But Inflation Data Loom Large
The US stock market has rallied to new highs due to a powerful technology rebound, but this growth is being put to the test by upcoming inflation data that could impact Federal Reserve rate decisions. The S&P 500 recorded its first close at a record level in two months, driven by gains in technology and semiconductor stocks.
The rally was also supported by easing tensions between the US and Iran and falling oil prices, which helped alleviate some inflation concerns ahead of the highly anticipated consumer price index (CPI) report. However, analysts warn that if CPI exceeds expectations again on Wednesday, a sell-off in the stock market could be expected.
Matthew Miskin, co-head of investment strategy at Manulife John Hancock Investments, noted that 'the market is currently experiencing inflation anxiety.' If oil prices continue to rise, that will increase inflation and raise the likelihood that the Fed will hike rates again.