S&P 500 Tops 7000 for First Time Ever

The S&P 500 index, a key indicator of the U.S. stock market, set a new record by surpassing the 7,000 mark for the first time ever. This is seen as a reflection of optimism surrounding improving U.S. corporate earnings and expectations for easing international tensions. The index closed at 6886.24 on the 13th, exceeding the February 27 closing price of 6878.88 and surpassing the previous record high of 6978.60 set on January 27. The S&P 500 has risen more than 10% since its low on the 30th of last month.

Expectations for the start of the first-quarter earnings season and a diplomatic thaw with Iran led the index's rise. U.S. President Donald Trump hinted at the possibility of resuming negotiations with Iran and mentioned an end to the war by the end of the month.

Technology stocks led this recovery, with market heavyweight Nvidia, the top company by market capitalization, surging 19%. Upward revisions to earnings forecasts for the tech sector in March also played a significant role.

A trend of capital inflows into the U.S. stock market was also evident. Over the past month, U.S. equity funds saw net inflows exceeding $111 billion, while European and Asian funds experienced net outflows. Global fund managers reportedly reduced their exposure to Japanese and Eurozone assets this month, increasing their allocations to U.S. assets and the technology sector. The attractive valuations following the stock market plunge and improved earnings outlook after the war have drawn investors to the U.S. market. The S&P 500's price-to-earnings ratio (P/E) has fallen to its lowest level since the market crash in April last year, and the percentage of fund managers who responded that U.S. stocks were overvalued reached its lowest point since 2019.