Investors shrugged off nerves about heavy AI buildouts and energy tightness, pushing major indexes closer to records ahead of earnings season. On Friday, the S&P 500 climbed 0.6%, while the tech-heavy Nasdaq 100 advanced 0.5%, notching a fourth week in a row of gains.
This bull run is nearing its fourth anniversary with little visible strain, supported by sturdy corporate profits and an index camped near its peak. Since 2022, the S&P 500 has rallied 117%, which CFRA places as the No. 3 bull run of similar duration in records going back to 1947.
A report said OpenAI anticipates annualized revenue reaching $70 billion and could top that before the year is over, lifting AI-spending sentiment and countering earlier claims of softer sales.
But there were pressure points. Nvidia-backed Firmus Grid Ltd. called off an Australian initial public offering only days after signaling robust demand for a transaction, with strong interest pointing to a $30 billion price tag for the data center operator. Meanwhile, Oracle's credit-default swaps hit fresh highs after Morgan Stanley warned that project delays might pressure the company's debt.
Not everyone buys the "too far, too fast" story. "People are worried, and that's not a sign of a bubble," said Christian Mueller-Glissman, a strategist at Goldman Sachs, on Bloomberg Television. "Usually, when you're in the bubble, there's a lot of exuberance, and people have FOMO." He also cited the classic J-curve of tech investment, where big upfront outlays take time to show up as revenue growth and productivity.
Markets near records while fears ease is a combination worth examining. Market Briefs covers that tension free every morning.
Even with the benchmark near its highs, participation looks thin: only about a third of S&P 500 stocks are above their 50-day moving averages, sharply lower than roughly 70% in mid-August.
Several of the biggest banks report next week after lagging over the past month, and investors want a cleaner read on the consumer. "We will be looking to see if credit has taken a leg down or if the K-shaped economy starts to converge."
Deere posted its steepest weekly drop since April 2023, sliding with other farm equipment makers amid a regulatory inquiry and softer crop prices. HP Inc. fell 3.5% after IDC reported that global PC shipments fell 20% in the third quarter versus a year ago, weighed down by supply bottlenecks and prior inventory pull-forward.
On the upside, Moderna jumped 14% after a New York Times report detailed a plan with the National Institutes of Health to speed work on developing and trialing cancer vaccines.
If this rally makes it to a fifth year, CFRA's history says the average gain for that year is 21%, suggesting room for leadership to broaden beyond the mega-cap tech names that have dominated since October 2022. For now, the headline indexes look strong, AI sentiment just got a boost, and banks are about to tell us how the consumer is really doing. That combo could determine whether this climb spreads out or stays top heavy.
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