The stock market has been performing well, with the Nasdaq composite surpassing 20,000 points and the S&P 500 nearing all-time highs. This rally can be attributed to the strong performance of megacap stocks, including Tesla, Alphabet, Amazon, Meta Platforms, and Apple.
Tesla's stock reached a record high, while Alphabet's shares surged due to the announcement of its latest AI tool and quantum-computing chip. Amazon and Meta also experienced gains.
The recent consumer price index (CPI) report indicated persistent inflation, but it aligned with market expectations. The Dow Jones Industrial Average saw a slight decline, while the S&P 500 and Nasdaq composite saw gains.
The overall market sentiment remains bullish, with more than 60% of investment newsletter writers expressing optimism. However, caution is advised as the Nasdaq is currently extended from its 50-day moving average, which historically raises the risk of a pullback.
Growth-focused ETFs have shown resilience, while the energy sector and Bitcoin have also seen positive movements. Investors are advised to remain vigilant, monitor market indicators, and develop a strategic game plan for their investments.