Investors’ fears of an economic slowdown are rapidly ebbing, fuelling a rally which is boosting the riskiest asset classes in particular as the “fear of missing out” that dominated stock markets before last year’s sell-off returns in force.
The S&P 500 US share index is up 8 per cent since the start of the year and the Nasdaq Composite, which is weighted towards America’s tech giants, has rallied 16 per cent. They were down by a fifth and a third respectively last year.
Friday’s blockbuster US jobs report helped bolster investors’ confidence about the strength of the American economy, despite the risk that it could prod the US Federal Reserve to keep monetary policy tighter for longer as it attempts to subdue still-high inflation. Markets closed up on the week despite dipping after the jobs report was published.