The S&P 500 and Nasdaq 100 extended their upward streak on Monday, both logging a robust eight consecutive sessions in positive territory as traders maintain optimism about the U.S. economic outlook and improving financial conditions ahead of the Federal Reserve’s anticipated rate-cut cycle.

For the S&P 500, this marks its longest winning streak since May 2024, while the tech-heavy Nasdaq 100 hasn’t seen such a run since October 2023.

The S&P 500, tracked by the SPDR S&P 500 ETF Trust (NYSE:SPY), closed Monday’s session up 0.95%, bringing it within just 1% of its all-time high reached in mid-July. Nearly 95% of S&P 500 companies have reported second-quarter results. FactSet data shows that 79% of these firms have exceeded earnings-per-share (EPS) expectations, and 60% have posted higher-than-expected revenue. The S&P 500's blended year-over-year earnings growth rate is at 10.9%, the strongest since Q4 2021.

The Nasdaq 100, monitored through the Invesco QQQ Trust (NASDAQ:QQQ), closed 1.3% higher, but it remains 4.6 percentage points below its record highs.

“Last week saw unfounded US recession fears and global financial market jitters go poof as quickly as they arrived,” wrote veteran Wall Street investor Ed Yardeni in a note Monday.

Monday’s session saw no economic data releases, but investors responded positively to comments from Minneapolis Federal Reserve President Neel Kashkari, a well-known hawk, who hinted at the possibility of a rate cut in September during an exclusive interview with The Wall Street Journal.

Market-implied probabilities currently indicate a 77.5% chance of a 25-basis-point rate cut in September, with a 22.5% likelihood of a larger 50-basis-point cut, according to CME Group FedWatch tool.

This week, traders will be closely watching key monetary policy discussions at the Jackson Hole Symposium, scheduled for Aug. 22-24, where Fed Chair Jerome Powell is set to speak on Friday at 10 a.m.

“If the Fed eases too much and doesn't push back against expectations of more rate cuts to come, the yen could strengthen again, triggering a second wave of unwinding carry trades,” Yardeni warned.

S&P 500’s Top Performers On Monday

Nasdaq 100’s Top Performers On Monday

Read Next:

• Goldman Sachs Cuts US Recession Odds To 20%, Reverses Earlier Increase As Economic Data Improves

Image created using artificial intelligence via Midjourney.