After two years of waiting, the S&P 500 has finally reached a new all-time high, indicating a shift from a bear to a bull market. The index confirmed its bull market status by closing at its intraday low on October 12, 2022. The S&P 500 gained 24% in 2023 and is already up 1.5% in January 2024. Last year, concerns were raised about the breadth of the rally, as it was mainly concentrated in the largest stocks, including Apple, Microsoft, Nvidia, and Meta. However, the recent record high has been fueled by chipmakers and other big tech stocks. The rally has also shown signs of broadening out, with the equal-weight index and small caps keeping pace or even slightly ahead of the S&P 500.

Investors will be closely watching a series of economic reports this week, including gross domestic product data and personal consumption expenditures prices. These reports will provide insight into how central bank policymakers view monetary policy moving forward. Additionally, investors are hoping for a series of benchmark interest rate cuts starting in March. However, the chance of a Fed rate cut in March has decreased to 47% from 81% a week earlier. The future of the bull market will likely depend on whether the U.S. central bank can achieve a soft landing for the economy without tipping it into a recession.