Investors have become more active in selling shares of ...
Investors have become more active in selling shares of businesses that are dependent on receiving money from the US federal budget. They anticipate a possible delay in government spending due to ongoing problems with raising the government debt ceiling. Meanwhile, investors shifted money into shares of technology companies - semiconductors and AI. The Nasdaq Composite and S&P 500 recorded their highest closes since August 2022.
At the same time, the media reports that investors have become more confident that the White House will reach an agreement with Congress to avoid a debt default.
Also the market is ignoring the threat of another Fed interest rate hike and rising government bond yields with a strengthening USD and is cheering on strong macroeconomic data. The market is also reacting positively to the big retailers' reporting season.
Due to difficulties with raising the government debt ceiling, US government bond yields have risen, pulling the US dollar up. And the rise in the dollar has in turn crushed commodities.
The battle over the debt ceiling is beginning to distort prices on the financial markets more and more.