The stock market powered ahead amid a renewed rally in technology companies, with traders also sifting through the latest remarks from a slew of Federal Reserve speakers for clues on the interest-rate path.

The S&P 500 topped 5,100 — hitting its 15th record this year — with Nvidia Corp. leading gains in megacaps and Dell Technologies Inc. soaring 32 per cent on solid sales. Traders looked past weak factory data and consumer sentiment amid bets the central bank will be able to cut rates as soon as June. U.S. two-year yields extended their slide after Fed Governor Christopher Waller noted he’d like a shift in the central bank’s holdings toward a larger share of short-term Treasuries.

“Market momentum remains intense, with any momentary period of weakness quickly bought by bulls,” said Mark Hackett at Nationwide. “The bear case has come apart as the technicals and fundamentals both support the rally, though elevated valuations and near-universal optimism are things to watch from a contrarian basis.”

The S&P 500 notched a second straight week of gains, the Nasdaq 100 climbed almost 1.5 per cent and a gauge of chipmakers jumped over 4 per cent. Treasuries rose across the curve, with two-year yields sinking eight basis points to 4.54 per cent. Oil hit US$80. Bitcoin rose above $62,000.

With results out from nearly all S&P 500 companies, fourth-quarter earnings look stellar. Growth was nearly 8 per cent, compared with expectations for a 1.2 per cent rise before the season started.

Those beats helped to offset macroeconomic uncertainty. Over the past two months, traders have pushed back their bets on when the Fed will start to cut interest rates. Fading hopes for easing monetary policy did little to aid equities at the start of the year just as earnings season came into focus. Some 76 per cent of firms surprised to the upside — outperforming the 10-year average of 74 per cent, per data compiled by Bloomberg Intelligence — prompting Wall Street to confidently snap up equities at a rapid clip.

The frenzy around artificial-intelligence stocks has blindsided Wall Street forecasters, spurring a race among strategists to keep up with a stock market rally that’s already blowing past their expectations when 2024 began.

Five Wall Street firms have already lifted their forecasts for the S&P 500, which is up a 7 per cent to start the year after rising 24 per cent in 2023. In the past week alone, Piper Sandler & Co., UBS Group AG and Barclays Plc boosted their targets. Two firms — Goldman Sachs Group Inc. and UBS — have done it twice since December.

The S&P 500 wrapped up the month of February with a rally of over 5 per cent, extending its winning run to four consecutive months.

Since 1950, whenever the gauge finished higher in both January and February, full-year returns for the index have averaged 19.8 per cent — with 27 of 28 occurrences producing positive full calendar-year returns, according to Adam Turnquist at LPL Financial.

“Can the winning streak continue?,” Turnquist said. “March has historically been a good month for stocks as the S&P 500 has posted an average return of 1.1 per cent. However, during election years, average March returns dip to only 0.4 per cent, with notable historical weakness midmonth.”

The S&P 500 also saw another weekly gain — marking the 16th out of the past 18 weeks in which equities have risen. That’s something that hasn’t happened since 1971, according to data compiled by Deutsche Bank AG. A look back at that period shows the winning steak was followed by five straight weeks of losses.

A stock indicator from BofA that’s tracking Wall Street strategists’ average recommended equity allocations ticked higher last month, moving closer to flashing a contrarian “sell” signal than a “buy” for the first time since April 2022. Still, the gauge remains in “neutral,” not “sell,” territory.

Equities managed to gain Friday despite data showing US factory activity shrank at a faster pace in February as orders, production and employment contracted.

To Chris Low at FHN Financial, despite weakness in the ISM manufacturing index, gross domestic product and consumer spending have remained strong. 

“February’s ISM Manufacturing survey underscores the slow movement in the upward trend of the past few months, but keeps it intact,” he noted. “Expectations of future stronger orders, expressed in the featured survey responses, is an encouraging sign, and a drop in the rate of prices paid shows input price inflation is under control for the time being.”

Also speaking Friday, Fed Bank of Atlanta chief Raphael Bostic said he doesn’t want to have to raise rates again. Fed Richmond President Thomas Barkin said markets are pricing in fewer rate reductions in response to economic data. His Dallas counterpart Lorie Logan reiterated it’ll likely be appropriate to start slowing the pace at which it shrinks its balance sheet. Chicago Fed chief Austan Goolsbee told CNBC he believes the Fed funds rate is quite restrictive — and he wouldn’t be surprised if January inflation ends up being just noise. And Governor Adriana Kugler said she’s “cautiously optimistic” that inflation will continue to cool without a notable rise in unemployment. 

In recent weeks, many policymakers have indicated that interest rates will remain at a 22-year high at least through the Fed’s next meeting on March 19-20, with the first cut likely later this year. Officials are watching to see whether January’s surprise jump in consumer prices was a fluke or a roadblock on the way toward lower inflation.

Fed Chair Jerome Powell looks set to echo his colleagues in suggesting that rate cuts are likely to begin “later this year” in his testimony to Congress next week, according to Andrew Hunter at Capital Economics. But with the downward trend in core inflation still looking intact, that doesn’t rule out a first cut in June, he noted.

U.S. policymakers are likely to raise their 2024 projections for economic growth and inflation at their upcoming meeting this month, upping the chances that the U.S. central bank might signal fewer interest rate cuts for this year, according to rate strategists at Bank of America Corp.

Apollo Management Chief Economist Torsten Slok said that a re-accelerating U.S. economy, coupled with a rise in underlying inflation, will prevent the Fed from cutting rates in 2024. 

“The bottom line is that the Fed will spend most of 2024 fighting inflation,” Slok wrote. “As a result, yield levels in fixed income will stay high.”

Treasury yields could soon be heading back toward 5 per cent if strong economic performance delays the Fed’s rate-cut plans, according to Capital Group Inc.’s Pramod Atluri.

Looking ahead, Target Corp., Kroger Co., Gap Inc. and Foot Locker Inc. will report earnings just as consumer confidence takes a turn for the worse, adding to their woes as same-store sales probably slipped across the board last quarter.

On the flip side, Costco Wholesale Corp., Ross Stores Inc., Burlington Stores Inc., and Nordstrom Inc.’s Nordstrom Rack are expected to do well, another sign that consumers are penny-pinching as they turn to stores that offer deals on branded goods.

Broadcom Inc. and Marvell Technology Inc. are poised to see an upturn from artificial-intelligence demand.

Corporate Highlights:

• Boeing Co. is in discussions to acquire Spirit AeroSystems Holdings Inc., a move that would reclaim control of its struggling former aerostructures unit and the main supplier at the center of numerous quality issues affecting the 737 Max airliner.
• New York Community Bancorp said its disclosure of “material weaknesses” in how it tracks risks won’t require additional reserves for future loan losses.
• ·Elon Musk sued OpenAI and its Chief Executive Officer Sam Altman, alleging they violated the artificial intelligence startup’s founding mission by putting profit ahead of benefiting humanity.
• Archer-Daniels-Midland Co. delayed its annual report and indicated that a “material weakness” in its internal controls won’t have a broad impact on earnings.
• Debt-laden Dish Network Corp. said it’s unlikely to meet an April 1 deadline to buy prized airwaves from T-Mobile USA Inc., a failure that would set in motion an auction of the frequencies valued at $3.6 billion or more.

Some of the main moves in markets:

Stocks

• The S&P 500 rose 0.8 per cent as of 4 p.m. New York time
• The Nasdaq 100 rose 1.4 per cent
• The Dow Jones Industrial Average rose 0.2 per cent
• The MSCI World index rose 0.8 per cent

Currencies

• The Bloomberg Dollar Spot Index fell 0.1 per cent
• The euro rose 0.3 per cent to $1.0837
• The British pound rose 0.2 per cent to $1.2656
• The Japanese yen fell 0.1 per cent to 150.15 per dollar

Cryptocurrencies

• Bitcoin rose 2.1 per cent to $62,740.66
• Ether rose 2.6 per cent to $3,439.08

Bonds

• The yield on 10-year Treasuries declined seven basis points to 4.18 per cent
• Germany’s 10-year yield was little changed at 2.41 per cent
• Britain’s 10-year yield declined one basis point to 4.11 per cent

Commodities

• West Texas Intermediate crude rose 1.9 per cent to $79.77 a barrel
• Spot gold rose 1.9 per cent to $2,083.66 an ounce