The S&P 500 repeatedly swings at high levels, and the signals behind it are worth pondering

Recently, the US stock market has been quite interesting— the S&P 500 index has been oscillating within a high range, attracting global investors' attention. Economic data looks solid, signs of a "soft landing" are gradually emerging, and corporate profits remain resilient. But the question is, how will interest rates move and what policies will be implemented? These factors are full of uncertainties. As a result, optimism and caution are constantly pulling at the market.

Interestingly, there have been changes within the index. Those large-cap tech stocks that once soared sharply are now entering a digestion phase. Conversely, energy, financials, and some defensive sectors are showing relative improvement. This indicates that funds are not fleeing the US stock market on a large scale but are reallocating—seeking more cost-effective and less risky positions.

The most critical data points right now are three sets: inflation, employment, and consumption. Every fluctuation in these indicators can amplify into short-term waves at the index level. The market swings between two extremes—hoping for economic slowdown without recession, yet worried about the long-term suppression of stock valuations by high interest rates. Every major data release prompts both bulls and bears to re-engage in the battle.

Don't forget, the S&P 500, as a "thermometer" of global risk assets, its movements spill over into emerging markets, cryptocurrencies, and even commodities. That’s why global investors keep a close eye on this index.

Looking ahead, the coexistence of high valuations and high expectations is more likely to lead to sideways digestion rather than a one-sided surge. For investors, rather than betting on the index rising or falling, it’s better to focus on structural changes and risk management—this is the real way to survive.