Zhitong Finance App learned that Bank of America pointed out that the breadth of the rise in the US stock market is improving, which is a positive signal.

Small cap stocks have risen significantly in the past week, while the S&P 500 index and Dow Jones Industrial Average have set historic closing highs on Tuesday. According to Dow Jones Market Data, the Russell 2000 index closed on Tuesday at its highest level since January 2022, and has risen for five consecutive days.

Stephen Suttmeier, technical research strategist at Bank of America, said in a research report on July 16 that the summer rally in 2024 has become more healthy.

According to FactSet data, as of Wednesday, the S&P 500 index has risen by more than 17% this year and has climbed 2.6% so far this month. The index has a large exposure to large-cap technology stocks, and the huge gains of companies such as Nvidia, Meta Platforms (parent company of Facebook), and Alphabet Inc. have driven its rise in 2024.

At the same time, the S&P 500 advance-decline line has reached a "new high to confirm the summer rally" at around 5,600, Suttmeier said. The advance-decline line is an indicator that measures market breadth and considers the number of stocks rising and falling.

According to FactSet data, the US stock market fell on Wednesday, with the S&P 500 index falling 1.39%. The tech-heavy Nasdaq Composite Index, which hit a historical closing high on July 10, plummeted 2.77% on Wednesday, while the blue-chip Dow Jones Industrial Average rose 0.59%. The Russell 2000 index fell 1.06%, ending its five-day winning streak. The index has surged 11.5% in the five trading days up to Tuesday and has risen 11.1% so far this year.

Editor/Emily