The S&P 500 closed the books on its best monthly performance since April and the best month of August since 1986, with a monthly gain of more than 7%
The Federal Reserve’s commitment to tolerate inflation and keep interest rates low, positive developments in vaccines and treatments for COVID-19 and a rally in tech-focused stocks have helped the S&P 500 and Nasdaq hit record highs in August.
“The U.S. just passed 6 million cases, a further reminder that the pandemic is here to stay until we do something about it. Clearly it has an impact on all businesses but some are more pandemic resistant,” he said. With the S&P reaching 3.8% above its pre-crisis record during the session, Mona Mahajan, senior U.S. investment strategist at Allianz Global Investors in New York, said investors were showing some caution by favoring technology as they looked warily at U.S. and overseas COVID-19 numbers.
While the splits did not provide a fundamental reason to buy the stocks, Mahajan noted that the lower prices may be making the momentum stocks more attractive to some retail investors. For the S&P, this was its longest winning steak on a monthly basis since a six-month run from April to September 2018.
The front facade of the New York Stock Exchange is seen in New York City, New York, U.S., June 26, 2020. REUTERS/Brendan McDermid
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