U.S. Stock Market Gains Underscore Optimism On Economy

The S&P 500 is on track for a 5% gain in the third quarter of 2024, with more stocks participating in the rally, easing concerns that the market’s surge had been overly reliant on a few big tech names earlier in the year, Lewis Krauskopf reported for Reuters.

More than 60% of S&P 500 components have outperformed the index so far this quarter, compared to just 25% in the first half of the year.

Optimism about the Federal Reserve’s interest rate cuts boosting US economic growth has driven investors toward a broader range of stocks, including regional banks and industrial companies, in addition to the tech giants like Nvidia and Apple, which saw massive gains earlier in the year.

More than 60% of S&P 500 components have outperformed the index so far this quarter, compared to just 25% in the first half of the year.

The equal-weight version of the S&P 500, which treats all stocks equally regardless of market cap, gained 9% in the quarter, outperforming the standard S&P 500.

This broadening of the rally signals growing confidence among investors and reduces concerns that the market would be vulnerable if the small group of tech stocks propping it up were to falter.