Nasdaq breaks the October high as the rally nears 2%

The Nasdaq has extended gains to 1.7% and broken the October high in the process.

The rally is particularly impressive given that Treasury yields are in the process of reversing higher. US 2-year yields are at the highs of the day up 3.2 bps to 5.05% after falling as low as 4.97% earlier. Ten year yields are up to 4.63% from 4.57%.

The Fed funds futures market is pricing in just 72 bps in cuts next year from 100 bps last week as Fed officials continue to emphasize the option to hike again. There may be some additional urgency in that commentary given the jump in today’s UMich inflation expectation numbers.

In any case, the market simply doesn’t care here. The tech rally is broad, led by chipmakers after Nvidia found away around a US chip blockade of China.

More broadly, the enthusiasm is slightly lower with the S&P 500 up 1.3% and the Russell 2000 up 0.7%.

I find this rally odd given the price action in Europe and elsewhere but that’s no reason to stand in the way of it, at least not yet.