Why is the US stock market rallying?

Three reasons why the US stock market is rallying

Tuesday has been a positive day for all three US major indexes.

The S&P 500 gained 0.71%, the Dow Jones went up by 1.06%  and the Nasdaq Composite closed the trading session with a profit of 0.76%.

In particular, The Dow Jones closed its seven-day winning streak yesterday, reaching the highest level since April 2022.

The positive stock trading movement has been driven by the following factors:

  • Solid US bank earnings reports
  • AI mania
  • Lower inflation and soft landing

Yesterday, in fact, Morgan Stanley shares rose 6.45% and Bank of America stocks went up by 4.4% after they reported a better-than-expected earnings report.

The second factor to consider to understand why the stock market is rallying is the Artificial Intelligence focus and the huge investments that some companies are making to take advantage of the new technologies.

Microsoft is, of course, one of them and yesterday’s market capitalization increased by more than $100 billion.

Microsoft stocks, yesterday, rose by 4% after the announcement to offer some new AI-powered services to individuals and businesses.

The monthly addition of $30 will give access to generative AI features in Teams, Excel, and Word.

Nvidia, the company that produces important chips used for the construction of AI chat models, gained 2.2% yesterday.

Bullish sentiment is the last, but not the least element to look at while we analyse the recent market rally.

Investors are confident that there will be no recession because inflation is slowing down while the economic data, including the strong job market, remain very solid in the US.

So, the Federal Reserve’s restrictive monetary policy is not scaring the investors that are continuing to buy shares.

Portfolio update

I am rebalancing my portfolio gradually.

I am adding new positions and will close some in the upcoming months.

If you are already copying my portfolio, please keep the copy open.

If you are thinking of copying me, now could be the right time, if you can invest for the long term (years).

Remember to copy the open trades to optimize the copy.

Remember to set the stop loss on the copy at the minimum level, so you don’t get stopped if there is a correction.

Thank you, everyone. Have a nice day!

Steps to follow to copy my portfolio automatically:

1. Create an eToro account here: https://federicamontella.com/go/etoro/

2. Verify your account and make a deposit of at least 200 USD (you can deposit in any currency, like GBP and EUR)

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4. Start the copy (copy open trades and set the lowest stop loss possible, to allow some movement)

5. Enjoy, it’s all automatic. You will make passive income 24/7

Let me know if you have any questions.


Federica Montella

eToro Popular Investor


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Author: Federica Montella
eToro Popular Investor, food lover and blogger. Stock trader and Popular Investor at eToro. I am on a mission to find the best restaurants and food to eat.