Stock futures are on the rise as Wall Street gears up for the commencement of the second quarter. Futures linked to the Dow Jones Industrial Average surged by 147 points, equivalent to 0.37%, while S&P 500 futures and Nasdaq-100 futures saw gains of 0.38% and 0.6%, respectively.
Last Friday, amid the closure of markets for Good Friday, the personal consumption expenditures price index was unveiled, indicating a 2.8% increase in inflation for February, aligning with forecasts. The Commerce Department reported that the inflation metric, closely monitored by the Federal Reserve, rose by 0.3% from the previous month.
Giuseppe Sette, co-founder and president of Toggle AI, remarked, “This underscores the gradual nature of progress on inflation and fortifies the argument for those skeptical of the Fed’s next rate adjustment. It’s worth recalling that the Fed typically maintains rates above inflation levels, barring anticipations of an economic slowdown.”
In addition, major indices concluded the first quarter on a positive note. The S&P 500 recorded its most robust quarterly performance since 2019, climbing by 10.2%, while the Dow Jones Industrial Average experienced a 5.6% increase, marking its best quarter since 2021. The Nasdaq Composite surged by 9.1%.
Furthermore, markets sustained their winning streak in March, marking the fifth consecutive month of gains, with the S&P and Dow rising by 3.1% and 2.1%, respectively. The Nasdaq witnessed a more modest uptick of 1.8% for the month.
The ongoing bullish sentiment towards artificial intelligence stocks and the tailwind provided by Nvidia have been key drivers of the market’s upward trajectory in the new year, following a robust performance in 2023. This optimism is accompanied by expectations for the initiation of a cycle of interest rate cuts by the Federal Reserve later in the year, with markets pricing in a potential cut as early as June.
Ryan Detrick, chief market strategist at Carson Group, suggested that this rally may have further room to run. He pointed out that historically, when the S&P has posted gains of 10% or more in the first quarter, it has ended the year higher in 10 out of 11 instances.
