Investor Hopes Rise as S&P 500 Rally Expands Beyond Megacaps

The U.S. stock market rally is showing signs of broadening beyond the mega-cap growth and technology companies, fueling investor hopes for a year-end rally. The S&P 500 has risen over 8% in November, driven by falling Treasury yields and cooling inflation readings. Recent market strength includes gains in areas that have lagged this year, with about 55% of the S&P 500 trading above their 200-day moving averages. The equal-weight S&P 500 index has outperformed the market-cap weighted index, and struggling small-cap and bank stocks have seen a boost. However, there are concerns that the rally may not be sustained, as further readings on consumer confidence and inflation could impact Treasury yields, and some investors may be reluctant to chase the rally as the year comes to a close.