S&P 500: Fresh records with easing stagflation fears – Deutsche Bank

Deutsche Bank analysts note that the S&P 500 has reached new record highs as stagflation fears eased on lower Oil prices and optimism over a US-Iran deal. The index gained 1.43% last week, marking a ninth consecutive weekly advance, the longest streak since 2023. Futures are modestly higher this morning, supported by strength in technology and AI-related names.

Equities extend multi-week winning streak

"With optimism rising on the geopolitical situation, equities also put in a strong performance around the world. For instance, the S&P 500 rose +1.43% (+0.22% Friday), marking a 9th consecutive weekly gain for the index, which is the first time that’s happened since 2023."

"So stagflation fears eased dramatically, and the S&P 500 hit fresh records. Otherwise, chip stocks were the big outperformer as excitement around AI returned, with the Philly semiconductor index up another +22.2% in total return terms in May."

"Tech stocks did particularly well, with the NASDAQ up +2.39% (+0.20% Friday). And the rally extended globally, with Japan’s Nikkei up +4.72% (+2.53% Friday), whilst Europe’s STOXX 600 saw a modest +0.14% gain last week (+0.14% Friday)."

"Brent is up +2.4% this morning but it hasn't impacted equities much with S&P (+0.25%) and Nasdaq (+0.52%) futures higher again and Asia again strong, mostly on the AI trade. Indeed the KOSPI (+4.45%) is again the standout performer."

"Elsewhere the Nikkei (+0.85%) and Hang Seng (+0.88%) are the other main gainers with mainland Chinese markets slightly lower, perhaps on fairly flat PMI data this morning and over the weekend."

"Moreover, South Korea’s KOSPI was up +28.5%, taking its YTD gains to an astonishing +102.4% in just five months."

(This article was created with the help of an Artificial Intelligence tool and reviewed by an editor.)