Chart of the Day – Monday, May 6, 2024

So far, in 2024:

US Dollar Index $DXY is up about 4%

US 10yr Yield $TNX has risen about 70bps

Despite higher rates and a strengthening dollar, the US stock market $SPX has gained about 8%

What do you think stocks will do if these intermarket headwinds abated…? pic.twitter.com/K4KUA6qonV

— Steven Strazza (@sstrazza) May 4, 2024

Today’s Chart of the Day was shared by Steve Strazza (@sstrazza).

• The US Dollar and the 10-year yield have been rising all year, and yet the S&P 500 is up +8.6% year-to-date.

• These two wrecking balls put significant pressure on the stock market in 2022. However, stocks have been more resilient these days.

• $DXY and $TNX have pulled back since mid-April, while stocks have rebounded nicely since then.

The takeaway: Stocks have been resilient this year despite higher yields and a rising dollar. If they continue to weaken, these two wrecking balls could fuel the next leg higher.