According to the Bank of America, the equity share of the assets is standing at a record position in the last seven decades. Interestingly, the stock market holdings are now equivalent to about half of the financial assets that the household owned during the 2nd quarter. Apart from the stocks, other elements considered as financial assets include certificates of deposit, cash, bonds and bank deposits. The mammoth figure stands at $109.2 trillion. According to financial experts, the US household wealth has never touched this astonishing figure. The credit for this giant leap should be given to the gains made in the stock market.
Despite all odds, the stock market is completely stable. In the second quarter, the overall household net worth succeeded in touching the giant figure of $141.7 trillion. There was an impressive enhancement of $3.5 trillion in the value of corporate equities. During this period, the stocks continued to rise. Investors are hopeful that the market fortune will remain stable. The ongoing scenario is very good for such individuals who own stocks. The financial experts and strategists always say that money and wealth flows to destinations where they get an opportunity to grow. As the stock value is enhancing, the investors are continuously investing. Of course, the investors will continue to do so unless they get a better option.
In 2021, the S&P 500 managed to rise by about 15%. The contributing factors were strong growth in corporate earnings, and very friendly monetary and fiscal policies. The government and leading banks were also actively helping to stabilize the economy. Several market-friendly policies have been launched. The senior politicians and financial experts are now becoming concerned. Stocks and houses make a significant part of people’s wealth, but both of them are tied to the interest rate. There were several policies that were enhancing the value of the assets. It is a $64 trillion question that what will happen after these policies are deactivated? The investors also take into account the market sentiments before making any move.
$34.5 billion have already been poured in ETFs and US equity mutual funds by investors in the last one year. This clearly indicates that the appetite for the stocks is not over yet. The financial picture is not always the same. The macroeconomic cycle can change. The global investment community continuously monitors the health of the US stock market. US equities were higher due to gains made in the basic material, oil and gas sector. The Dow Jones Industrial Average made a gain of 1.43%. The NASDAQ Composite index rose by 0.82% and the S&P 500 index added by 1.15%.