Market Keep Climbing Despite Oil Spike and Macro Risks
The week is ending and, surprise surprise, the S&P 500 is printing another new ATH. The index reached 7,400 points for the first time ever. YTD, we are up +8% despite high oil prices, elevated debt levels, and ongoing macro hotspots. Who would have thought the market would remain this resilient? Over the last 12 months, the index is up an impressive +30%.
On one hand, the backdrop is driven by hopes for easing tensions around Iran and the Strait of Hormuz. On the other hand, the market is likely pricing in the expectation that a potential new Fed Chair, Warsh, could take a more dovish stance than the current one. Whether all of this actually plays out remains to be seen.
I’m staying cautiously optimistic, keeping some cash on the sidelines, but remaining invested.