The Nasdaq 100 had a remarkable first half of the year, achieving its highest performance ever, driven by increased investment in technology stocks due to the rise of artificial intelligence.
Closing at 15,603.04 on Friday, the tech-heavy index experienced a 1.5% rise and a year-to-date increase of 39.7%. Surprisingly, the Nasdaq 100’s value surged by nearly $5 trillion since the beginning of the year, defying concerns of a market bubble and establishing itself as one of the world’s top-performing equity indexes.
The rally in technology stocks can be attributed to various factors, such as the growing adoption of AI by both businesses and consumers, along with the robust earnings growth of tech companies.
To further support the ongoing rally, major banks like JPMorgan Chase, Wells Fargo, Morgan Stanley, and Goldman Sachs announced higher dividends on Friday after successfully passing the Federal Reserve’s stress test. This reinforces confidence in the financial system and could have a positive impact on investor sentiment.
The overall market performance ended the week positively, with the S&P 500 reaching its highest level since April 2022. Despite concerns regarding rising inflation and interest rates, the strong performance of the markets suggests that investors remain optimistic about the economy’s outlook.
Nevertheless, there are concerns that the rally in technology stocks may not be sustainable due to stretched valuations. Whether the momentum in tech stocks can continue in the second half of the year remains uncertain.
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