The S&P 500 and Nasdaq reached fresh record highs this morning and are now taking a breather after a week of powerful moves in Technology (XLK). Today the move higher comes from software following the latest batch of earnings.

Technology names are once again doing all the heavy lifting. Datadog (DDOG) is sharply higher and contributing to strength in software, while Microsoft (MSFT) is also a mega-cap standout. On the other side, Energy (XLE) and Utilities (XLU) are seeing continued weak performance.

AI vs. Not AI

There are 42 stocks in the S&P 500 sitting at or within 2% of a 52-week high, and 31 of them are in the AI industry group. This is roughly two-thirds of the index’s total number of components at or near 52-week highs.

Economic Data

The market is powered higher by cash flooding into the economy. The current money supply measure “M2” hit new all-time high of $22.7 trillion.

The New York Fed’s April survey showed 1-year inflation expectations rising to 3.64% from 3.42% while the long term remains almost unchanged at around 3%.

Construction spending for March rose to a seasonally adjusted annual rate of $2,185.5 billion, a 0.6% increase.