US equities rally broadens, S&P 500 equal-weighted index hits 26-month high. Momentum raises continuation questions.

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“The rally in US equities since last October’s near-death experience has been unmistakably broad, even though the Mag 7 have captured most of headlines. And last week this broadening was confirmed when the S&P 500 equal-weighted index made an all-time high for the first time in 26 months.

Both the charts show the percentage of stocks above their 200-day moving average (green shading). Not surprisingly, periods of strong momentum are generally green, and that’s where we find ourselves today. The question, of course, is whether it will continue.”

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