Market Call: Melting Up?

Growing confidence in the resilience of the economy has been one of the main reasons why the stock market has been so strong since October 12, with the S&P 500 up 24.4%, the Nasdaq up 32.4%, and the S&P 500 Transportation index up 21.0% since that date.

On Friday, the S&P 500 closed up 1.22% at 4450.38 (chart). That's even though that morning we learned that May's personal consumption was weaker than expected and core inflation was higher than expected (chart). In addition, Fed officials have turned more hawkish in recent days causing the 2-year Treasury yield to rise to 4.90% on Friday, the highest since March 9, just before SVB hit the fan.