As the S&P 500 hovers around its highest levels on record and investors pile into riskier stocks, market sentiment signals “excessive optimism,” according to Ned Davis Research analyst London Stockton. That could leave the market vulnerable to a pullback.
The S&P 500 was up 0.6% and on track to build on yesterday’s record close. It also set another intraday record high. The Nasdaq Composite was up 0.3%, a tick below its record from Monday. The Dow was up 415 points, or 0.9%, moving within a few hundred points of its Dec. 4 record.
The market is in the midst of a second-quarter earnings season with stocks sporting ballooning valuations; Texas Instruments was the latest firm to see shares fall sharply amid concerns from investors about the impacts of tariffs. Alphabet and Tesla will kick off Magnificent Seven earnings after the close.