In resilient summer, investors maintain appetite for risk

S&P 500 has another winning month, but some experts are wary of chasing more gains.

- ISABELLE LEE AND DENITSA TSEKOVA

Even after Friday’s stock dip, Wall Street’s risk-on momentum train is barreling into September at full steam — and few investors are showing signs of hesitation.

Markets barely flinched last week — despite fresh political pressure on the Federal Reserve and tepid Nvidia Corp. revenue guidance— until a tech-led pullback Friday, amid thin trading. Yet the late-week wobble offered only a flicker of doubt in an otherwise resilient summer, with the Standard & Poor's 500 index notching a fourth straight monthly gain.

Risk appetite continues to spill into nearly every corner of markets, from corporate bonds and cryptocurrencies to cyclical currencies. The rationale feels deceptively simple: The Fed looks poised to cut interest rates, the U.S. consumer has so far proved the doubters wrong, and the artificial intelligence story still commands momentum.

That logic has proved resilient even in the face of mounting risks. Trade frictions, a cooling labor market and conflicting bond signals haven't derailed the rally. If anything, they've hardened bets that monetary support is imminent — and that the expansion, while aging, still has legs.

One way to dissect the bullishness is a cross-asset momentum gauge maintained by Societe Generale. It blends 11 components, including copper versus gold, cyclical stocks versus defensive, crypto, high-yield bonds and more. It has flirted with the most bullish thresholds at least five times since the tariff-spurred fallout in April — including again this month.