US Markets Hit Highs Despite War and Oil Price Surge
Despite ongoing conflict and elevated oil prices causing financial strain globally, the US sharemarket has reached all-time highs. The S&P 500 recently capped a three-week winning streak, rising 10.7 percent in April, driven largely by tech stocks. Investors appear to be ignoring inflation risks and interpreting former President Trump's rhetoric as a signal that his enthusiasm for the war is waning. In contrast, the real economy faces significant challenges. In Australia, companies like Qantas and Westpac have issued profit downgrades due to soaring fuel costs, while consumer spending on discretionary items declines. A fire at the Geelong Viva refinery has further highlighted supply vulnerabilities. The Reserve Bank of Australia warned of higher inflation and lower economic activity. Although Australian markets have also recovered slightly, the disconnect between Wall Street's optimism and Main Street's economic hardship remains stark. Analysts suggest US investors are acting as psychologists, betting that political shifts will mitigate the war's long-term economic impact, even as global businesses grapple with immediate financial damage.
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US Markets Hit Highs Despite War and Oil Price Surge
Despite ongoing conflict and elevated oil prices causing financial strain globally, the US sharemarket has reached all-time highs. The S&P 500 recently capped a three-week winning streak, rising 10.7 percent in April, driven largely by tech stocks. Investors appear to be ignoring inflation risks and interpreting former President Trump's rhetoric as a signal that his enthusiasm for the war is waning. In contrast, the real economy faces significant challenges. In Australia, companies like Qantas and Westpac have issued profit downgrades due to soaring fuel costs, while consumer spending on discretionary items declines. A fire at the Geelong Viva refinery has further highlighted supply vulnerabilities. The Reserve Bank of Australia warned of higher inflation and lower economic activity. Although Australian markets have also recovered slightly, the disconnect between Wall Street's optimism and Main Street's economic hardship remains stark. Analysts suggest US investors are acting as psychologists, betting that political shifts will mitigate the war's long-term economic impact, even as global businesses grapple with immediate financial damage.
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