The extended market rally led Bank of America to forecast further gains for the S&P 500. Strategist Stephen Suttmeier expects the broader index to hit 6,150, 8.5% above Tuesday’s close. Rate-sensitive sectors such as regional banks and small-cap stocks have gained in the past week as investors have become more optimistic about rate cuts. So far this month, the real estate, financials and consumer discretionary sectors are up more than 4%. The Russell 2000 index surged 10.5% in July and is up 11.7% year to date. “Breadth at the index level has improved, with the Russell 2000 (IWM), NYSE (NYA) and Dow Jones Industrial Average (INDU) also breaking new highs, indicating that the rebound in the summer of 2024 is becoming healthier.” Sattmeier said in wrote a report on Tuesday. In a bullish cup-and-handle chart pattern, the broader market index has reached the 5,600 level, which traders view as a bullish signal that prices will continue to rise. Suttmeier said expanded participation in the S&P 500 market rally supports more upside potential from the 6,150 level. Additionally, the number of S&P 500 stocks trading above their 50- and 200-day moving averages has improved, suggesting market breadth is stabilizing, the strategist said. .SPX YTD mountain S & P 500 in 2024 Suttmeier believes the iShares Russell 2000 ETF, which tracks the benchmark small-cap index, can break out to 260. IWM YTD mountain IWM ETF in 2024 — CNBC’s Michael Bloom contributed reporting.
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