From Yield Scare to Record Close:

Breadth Repairs as the Dow Sets an All-Time High, but New-Highs Leadership Stays Thin

Market Regime Snapshot

The S&P 500 began the week on a downward trajectory, experiencing three consecutive declines as the 10-year Treasury yield reached a one-year high. However, it staged a midweek recovery and continued its upward momentum into Friday’s close. Notably, the Dow Jones Industrial Average achieved a record high of 50,579.70, while the S&P 500 added 0.37%. The primary catalyst for this turnaround was the interplay between a risk-off sentiment driven by the Treasury and a late-week recovery fueled by hopes of an Iran peace deal. On Friday, Qualcomm’s stock surged over 11%, and Dell’s stock rose more than 16%. The University of Michigan consumer sentiment index was revised to a record low of 44.8, significantly below the consensus estimate of 48.2. Additionally, 1-year inflation expectations were revised up to a nine-month high of 4.8%. The breadth of the market recovered as shares of S&P 500 stocks above their 20-day average increased from 43.93% on Monday to 46.91% midweek before reaching a remarkable 57.76% on Friday.