US inflation data that will be released on Wednesday, April 10th, would nominally form another challenge for a lasting bullish trend on Wall Street. The headline CPI (consumer price index) is expected to jump from 3.2% to 3.4% YoY in March, with core numbers (excluding volatile food and energy) slowly declining from its 4.0% pre-Christmas peaks to 3.7%, compared to 3.8% a month ago. This is widely considered as a risk factor, which could prevent Jerome Powell and his colleagues from the Federal Reserve to launch borrowing cost cuts in June. Inflation spirit goes to the forefront following much stronger-than-expected non-farm payrolls last Friday at 303,000 vs 212,000 of expert consensus, when the U3 unemployment rate amounted to 3.8% approaching an 8-month low. Yet, I believe a tight labour market and persistent price pressure is only an imaginary threat for the Wall Street mood now.

The major argument is that most investors just don't care too much of the particular timing for rate cut moves in 2024, as the proximity of the pivot point in this monetary cycle is not questioned by central bankers anymore. The FedWatch tool on CME indicates 87.3% of the market crowd are betting for one, two or even more rate cut moves even from June to September. Besides, the USD index also retreated from its April 1 highs above 105 to nearly 104, instead of trying to climb, which would be in a case of keeping "higher for longer" rate bets. Small turbulence is possible during the Wall Street flight to new historical records, but nothing more than that. The basic principles and reasons behind the current S&P 500 rally to 5,500, and probably higher, are in the psychology field, as asset portfolio holders still prefer equities rather than cash or bonds nominated in US Dollar, Euro or Chinese Renminbi. Shares of Google, Amazon, Microsoft or some other giant businesses nearly acquired the status of new money, or one may call it as an intermediary means of capital investment and further transformation to money for payment.

Analysts at Oppenheimer set their price targets for Google-parent Alphabet at $185, compared to $172 before. They raised Meta price target to a "golden probe" number of $585 from $525, citing "incorporate AI tailwinds and historical seasonality" and maintaining an Outperform rating on both stocks. Many other large and popular investment and media resources did similar moves in recent weeks. Most of them also encourage a big game in the AI "underbrush" including component manufacturers and partners of NVidia. Citigroup just reaffirmed its buy rating on Micron Technology after the Taiwan earthquake impact with a price target of $150 despite the recent growth from a $90 area to above $125. City foresees a potential deficit in dynamic random-access memory (DRAM) supply, which would be favourable for Micron even though Micron is exactly the company, which conducts 60% of its DRAM production in the suffered region of Taiwan. Micron already paused its quotes for 2Q 2024 DRAM contracts, and the move was accompanied by Micron rival SK Hynix.

It looks like any opportunity or occasion is suited for gathering arguments in favour of the rally extension. A purely technical fact that the upside direction was immediately restored after a short-lived price correction on April 4th is another evidence that bulls are in full control of the situation.