The S&P 500 (Index: SPX) roared to new record highs, closing the trading week at 4,352.34, having closed higher on each of its last seven trading days.

The alternative futures chart shows the trajectory of the index rising to the top end of the latest redzone forecast range:

The redzone forecast assumes investors would focus on 2021-Q3 in setting current day stock prices, but that may have changed during the past week, thanks to the continuing efforts of Federal Reserve officials to set expectations they will not hike rates until late 2023 to respond to inflation, which they continue to claim is transitory.

Instead, the economic data is such that Fed officials are instead signaling they will begin tapering their stimulus bond buys at the end of 2021, which we think may have prompted investors to shift their forward-looking attention outward to the more distant future quarter of 2022-Q1.

When we refer to future quarters, we're referring to the periods covered by dividend futures contracts, which do not follow calendar quarters. For example, 2021-Q4 will end when its dividend futures contract expires on the third Friday of December 2021, or rather, on 17 December 2021. The Federal Reserve's Federal Open Market Committee's final meeting of the year will occur earlier that week, where any action they choose to take would begin just as 2021-Q4 ends, which is why investors would focus on 2022-Q1.

Our thinking is paced in part by the market moving headlines of the week that was, where you can see the efforts of the Fed's minions to set future expectations:

Monday, 28 June 2021

• Fed minions question cryptocurrency, want to keep greasing mortgage market, say inflation won't last:
  • NY Fed's Williams says major questions need to addressed as digital currencies emerge
  • Fed's Rosengren says U.S. can't afford housing market 'boom and bust' - FT
  • Fed's Quarles says supply chain imbalances boosting inflation are transitory
  • Fed's Barkin says U.S. has made "substantial further progress" on inflation goal
• Big trouble developing in
  • China's factory activity seen growing at a slower pace in June: Poll
• ECB minions torn between keeping pandemic stimulus going or stopping it someday, think Eurozone banks will suffer without continued support:
  • ECB hawks and doves spar as tapering debate fires up
  • Emergency ECB stimulus could end next March: Holzmann
  • ECB should retain flexibility of emergency stimulus scheme - Panetta
• Eurozone banks suffering from weakening credit quality: ECB
• Tech stock rally sends S&P and Nasdaq to record highs

Tuesday, 29 June 2021

• Signs and portents for the U.S. economy:
  • U.S. home prices rose in April at fastest pace in 15 years - S&P/Case-Shiller
  • Oil firms as demand hopes outweigh rise of COVID-19 variant
• Fed minions talk about letting banks fail again, stopping taper, rate hikes next year:
  • Fed's Kashkari says banks can't expect the government to bail them out of every crisis - FT
  • Fed should pursue 'least drama' way of tapering - Fed's Barkin
  • Fed's Waller: 2022 rate hike possible, wants MBS taper first
• Bigger inflation developing all over:
  • Pandemic boom drives UK house prices up by most since 2004
  • France sees June consumer boom after COVID restrictions eased
  • German inflation slows but remains above ECB target in June
• S&P, Nasdaq rise to record closes

Wednesday, 30 June 2021

• Signs and portents for the U.S. economy:
  • U.S. mortgage applications decrease by most in nearly five months -MBA
  • U.S. private payrolls increase solidly; pending home sales rebound
  • Boom! U.S. consumers hit by rising prices for Fourth of July fireworks
• Fed minion talks about tapering bond buys sooner:
  • Fed's Kaplan says he wants taper to start 'soon,' be gradual
• S&P 500 notches fifth straight record closing high, fifth straight quarterly gain

Thursday, 1 July 2021

• Signs and portents for the U.S. economy:
  • U.S. manufacturing sector grows moderately; prices paid at record high-ISM
  • Construction spending unexpectedly falls in May
  • Oil prices up about 2% on OPEC+ output, demand prospects
• Fed minions haunted by ghosts:
  • Analysis: Ghosts of crises past haunt policymakers and markets
• Pandemic status determines economic recovery level:
  • India's factory activity shrinks for first time in 11 months amid COVID-19 crisis
  • Spanish factory activity hits another two-decade high - PMI
  • UK factories ride demand boom, price pressures hit record - PMI
  • Eurozone factory growth, input costs rose at record pace in June -PMI
  • European factories racing as Asian manufacturers see momentum weaken
  • Brazil manufacturing PMI in June hits four-month high -IHS Markit
  • Mexico's factories contract at the slowest pace since COVID hit
• Bigger inflation developing all over:
  • EU's indebted states could ill afford yield surge, watchdog says
• ECB minions fear mutated virus strains and inflation, can no longer tell "normal" from "crisis", or ever allow interest rates to rise:
  • Euro zone recovery faces risks from virus mutations, ECB's Lagarde says
  • ECB should not tolerate inflation overshoot, Weidmann says
  • Explainer: When is a crisis no longer a crisis? A dilemma for the ECB
  • EU's indebted states could ill afford yield surge, watchdog says
• S&P 500 winning streak extends to sixth straight record close

Friday, 2 July 2021

• Signs and portents for the U.S. economy:
  • U.S. June payrolls top expectations, wage growth looks on the moderate side
    • Analysis: U.S. states ending jobless benefits early hit labor market milestone in March
  • U.S. factory orders rebound strongly in May
• Fed minions concerned about effects of printing too much money:
  • Explainer-How excess cash is playing out in U.S. reverse repo and money markets
  • Fed's Daly: 'We're on our way' back to pre-crisis employment levels
  • Fed's Daly: Appropriate to consider tapering later this year
• Bigger inflation developing all over:
  • Euro zone producer prices accelerate in May
• ECB minions say Eurozone economy is still weak, despite rapid growth :
  • ECB's Lagarde says euro zone recovery still fragile
• Wall Street hits record on robust June jobs data

Need more U.S. markets and economy news? The old standby of the Wall Street Journal provides above-average news coverage, falling in the "center" range of Allsides' bias ratings.

The next week will be interesting because of the S&P 500's current streak of consecutive higher daily closes. We'll find out how close it might get to a new record in that category as well!