Options Pros Are Worried About S&P 500 Rally’s Staying Power
- 11% YTD gain faces headwind as Fed easing bets get pushed out
- Cost to hedge against 10% drop in SPY ETF is highest this year
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Investors are showing growing doubts about the resilience of the US stock market’s advance as the calendar flips to a historically feeble stretch and questions swirl around the prospect of Federal Reserve monetary easing.
The S&P 500 Index has gained almost 11% to start the year, posting a string of record highs on the back of a resilient economy, improving corporate earnings and generally cooling inflation, not to mention torrid demand for shares linked to the artificial-intelligence boom. It’s the third-best January-May stretch since 2000.