The S&P 500 index hit a record level during yesterday’s trading, driven by a rally in technology stocks and optimism over corporate earnings.
Expectations of growth in the artificial intelligence sector boosted momentum in the bull market that began in October 2022.
The index briefly rose 0.6% to 7,817.13 points, surpassing its previous peak of 7,816.7 points.
The Nasdaq index also traded at record levels, according to Reuters.
In early trading, the Dow Jones climbed 0.32% to 51,432.35 points.
The S&P 500 rose 0.48% to 7,811.72 points, while the Nasdaq gained 0.59% to 27,639.89 points.
Mustafa Abu El Ela, head of strategy at Fortress Investment, linked the gains to expectations that earnings for index companies would grow between 25% and 30% in the third quarter.
In an interview with Al Arabiya Business, he added that spending by technology and artificial intelligence companies would exceed $600 billion by the end of 2026.
He also pointed to share buybacks by index companies worth about $1 trillion over the year ending in June 2026.
In addition, falling energy prices and a slowdown in the rise of bond yields helped support stocks.
However, Abu El Ela said the continuation of the gains depends on revenue growth keeping pace with massive spending.
He warned of the impact of rising interest rates on companies borrowing to finance their investments, predicting that US and European bond yields would continue to climb amid growing concerns over global debt.
Read also:
