Record-Setting Momentum Rally Is Drawing Doubters

Global equities, led by the S&P 500, have surged into record territory—the S&P is up almost 10% since the end of March and on pace for its best monthly gain since late 2020—fueling both optimism and caution. Treasury yields eased after a DOJ probe closure cleared the way for a Fed succession, boosting bets on rate cuts later in the year, but stalled Iran peace talks, high oil prices and still-elevated yields leave risks intact. Notable investor flows include large outflows from oil ETF USO and withdrawals from semiconductor fund SOXX, and banks note increased protection buying amid crowded positioning. A slate of mega-cap earnings (Alphabet, Microsoft, Amazon, Meta, Apple) this week is seen as a key catalyst that could either extend the rally or trigger a shakeout if results disappoint.