The S&P 500 just hit its seventh consecutive record
The index will have a chance to match the June 1997 streak on Tuesday. (The US stock market is closed Monday for Independence Day.)
The Dow Jones rose 1% this week while the S&P 500 and Nasdaq each finished with weekly gains of around 2%.
Even if the market is starting to look a little sparkling for some investors, several experts are convinced that the record race still has legs. That’s because the economy may be in that proverbial Goldilocks period where it’s neither too hot nor too cold.
“The jobs report had something for everyone,” said Michael Arone, chief investment strategist at State Street Global Advisors. “The number of payrolls was higher than expected, but the pay increases were modest. So, for those worried about a significant pick-up in inflation, this report didn’t signal it.”
Arone added that it was encouraging to see job gains in sectors hit hard by the pandemic, such as leisure and hospitality, retail and education.
He also noted that as the economy continues to improve, corporate profits are expected to continue to rise. This means that stocks, while not exactly cheap, aren’t too expensive yet.
“This market is profit driven and they are growing faster than expected,” Arone said.
And as long as sales and earnings continue to rise, there is little reason to expect stocks to experience a major pullback anytime soon.
“We are only at the beginning of the nascent stages of the next great economic rebound and bull market,” said Michael Reynolds, vice president of investment strategy at Glenmede.
“This doesn’t mean that there won’t be setbacks or market corrections along the way,” he added. “But it’s so different from a typical post-recession environment. There is still so much consumer demand.”