Longest winning run in two years is achieved by the S&P 500 and Nasdaq on rates perspective

 Longest winning run in two years is achieved by the S&P 500 and Nasdaq on rates perspective

Due to predictions that the Fed has completed its cycle of rate hikes, the yield on the benchmark 10-year Treasury note was headed for its seventh fall in as many sessions. With the $48 billion 3-year note auction and the upcoming 10-year note and 30-year bond auctions later this week, yields continued their downward trend.

Tuesday saw advances in U.S. equities for the first day in two years, with the S&P 500 and Nasdaq recording their longest winning streaks ever. The rally in U.S. Treasury yields supported megacap growth firms, while investors continued to look to the Federal Reserve for more hints on interest rate policy.

Due to predictions that the Fed has completed its cycle of rate hikes, the yield on the benchmark 10-year Treasury note was headed for its seventh fall in as many sessions. With the $48 billion 3-year note auction and the upcoming 10-year note and 30-year bond auctions later this week, yields continued their downward trend.

Although there has been a recent rise in expectations that the Fed's cycle of rate increases is coming to an end, central bank officials have been cautious in their statements on the future path of interest rates, and the market is still sensitive to the chance of further raises.

According to CME's FedWatch Tool, markets are pricing in a 90.2% possibility that the Fed will keep rates unchanged at its December policy meeting, up from 68.9% one week ago.

As the Federal Reserve mulls over its next course of action, Fed Governor Christopher Waller said on Tuesday that the current quarter's annualized 4.9% rate of growth in the US economy was a "blowout" performance that should be closely monitored. According to fellow governor Michelle Bowman, the latest GDP figure shows that the economy has not only "remained strong," but may have even picked up steam and needs a higher Federal Reserve policy rate.

Both Presidents Austan Goolsbee of the Chicago Fed and Neel Kashkari of the Federal Reserve Bank of Minneapolis declined to rule out rate reductions.

Jerome Powell, the chairman of the Fed, will talk on Wednesday and Thursday.

"The Fed is done, according to the report today, but maybe not yesterday. Powell's speech on Thursday will leave things open, according to Ken Polcari, managing partner of Boca Raton, Florida's Kace Capital Advisors.

"But what the market teaches you - the market, traders - they're lobbying for is we're all done, it's a rate cut, almost as if somebody are trying to force the hand."

The largest increases to the S&P 500 and Nasdaq were provided by megacap growth names including Microsoft (MSFT.O), up 1.1%, Apple (AAPL.O), up 1.5%, while Amazon, up 2.1%, thanks to the yield curve's retreat.

The S&P 500 (.SPX) gained 12.40 points, or 0.28%, to 4,378.38; the Nasdaq Composite (.IXIC) advanced 121.08 points, or 0.90%, to 13,639.86; and the Dow Jones Industrial Average (.DJI) increased 56.94 points, or 0.17%, to 34,152.8.

The Nasdaq (.IXIC) posted its eighth consecutive day of gains, while the S&P 500 (.SPX) enjoyed its seventh straight day of gains. This is the longest such run for any index in two years. The Dow increased for the seventh consecutive day, the biggest streak since a run of 13 days in July.

The worst-performing sector of the day, energy (.SPNY), had a 2.2% decline as oil prices dropped more than 4% due to worries about demand and a stronger currency.

President of the Dallas Federal Reserve Bank Lorie Logan also weighed in, stating that while she had agreed to keep the Fed's policy rate at its current level last week in order to evaluate whether or not tight financial conditions would be enough to reduce inflation, the rate is still too high.

Uber Technologies (UBER.N) increased 3.7% after the ride-hailing company exceeded analyst projections for adjusted core earnings in the fourth quarter.

After increasing its prediction for yearly adjusted earnings and sales, Datadog (DDOG.O) saw a 28% increase in value.

On the NYSE, falling issues exceeded advancers by a ratio of 1.2 to 1, whilst on the Nasdaq, the difference was 1.1 to 1.

While the Nasdaq registered 48 new highs and 145 new lows, the S&P 500 recorded 15 new 52-week highs and three new lows.

10.08 billion shares were traded on US exchanges throughout the whole day, which is lower than the 10.94 billion average for the previous 20 trading days.