Debt ceiling deal and market concerns overshadow optimism.

The recent deal to raise the US debt ceiling will shift Wall Street's focus to other emerging risks, including further Federal Reserve interest rate hikes and an expected reduction in fiscal spending. The S&P 500 is up more than 9.4% for the year to date and now trades at nearly 19 times its forward earnings, at the high end of its historical range. Markets are now pricing in a roughly 50-50 chance that the Fed raises rates by another 25 basis points at its June 14 meeting. A Congressional package raising the debt ceiling is expected to cap spending on government programs, which, combined with the possibility of higher interest rates to cool inflation, could help push the US economy into a recession despite ongoing strength in the labor market.