The S&P 500 reached a new record high last week, which is of great interest to investors after a strong first half of the year. The index closed above 6,200 points for the first time since February, marking an impressive rally of about 25% from its low in early April. This development marks the fastest recovery to a record high after a drop of at least 15% in the index’s history – within just 89 trading days.
Reasons for the Record High
The reasons for this record high primarily lie in the progress of the U.S. government’s trade negotiations with key partners just before the expiration of a tariff deadline on July 9, which is encouraging for investors. Despite economic uncertainties and challenges from high tariffs on imports from the EU and China, the stock market remains robust, although experts warn of a potential bubble formation as financial markets partially detach from real economic developments.
Political Influences
Additionally, the mood is boosted by political efforts in the Senate to pass a comprehensive tax and spending package by early July, although this could have negative impacts on certain sectors such as renewable energies.
Overall, the new record high of the S&P 500 still signals optimism in the U.S. stock markets despite existing economic uncertainties, with investors particularly focusing on political developments and trade agreements.