S&P 500 Extends Rally to Eight Straight Weeks
The S&P 500 has recorded an eighth consecutive weekly gain, according to Deutsche Bank strategists, marking one of the more sustained rallies in recent memory. Falling oil prices and a pullback in stagflation concerns โ the toxic mix of slowing growth and persistent inflation โ have been cited as key drivers behind the move.
What’s Driving the Momentum
Lower oil prices have helped ease cost-of-living pressures on US consumers and businesses, reducing fears that the Federal Reserve may be forced into a stagflationary corner where it must choose between fighting inflation or supporting growth. That shift in sentiment has kept equity bulls in control through the US long weekend.
US equity futures edged modestly higher following the extended break, though Deutsche Bank noted they remained slightly below pre-strike levels โ a reference to geopolitical or industrial disruption that had briefly weighed on sentiment.
Australian Angle: ASX and AUD Exposure
For Australian traders, a sustained S&P 500 rally typically provides a constructive backdrop for the ASX 200, particularly in growth and technology-linked names. The easing stagflation narrative also supports risk appetite, which tends to lift the AUD/USD pair as investors move away from safe-haven positioning.
Locally, lower global oil prices apply downward pressure on energy sector stocks on the ASX, including Woodside Energy and Santos. Traders with exposure to those names should monitor whether the crude pullback deepens or stabilises through the week ahead.
What to Watch Next
The durability of this winning streak will be tested by upcoming US inflation data and any shift in Federal Reserve guidance. A ninth consecutive weekly gain would represent a significant technical milestone and could attract further institutional inflows with flow-on effects for ASX-listed global ETFs.
Directional bias: Cautiously bullish โ momentum remains intact, but futures sitting slightly below pre-strike levels suggest traders are not fully committing until clearer macro signals emerge.
Source: FX Street