The Nasdaq Composite is inching closer to a record high thanks to a rally led by Nvidia, a major player in the tech industry. The tech-heavy index is nearing its first record close in 27 months, with a surge of 346 points or 2.2% at 15,927 on Thursday morning. This is just shy of its previous record close of 16,057.44 set on November 19, 2021.
If the Nasdaq Composite surpasses this threshold, it will break a dry spell of 564 trading days without a record close, making it the longest stretch since the burst of the dot-com bubble from March 2000 to April 2015. The index’s all-time intraday high was recorded on November 22, 2021, at 16,212.23. In contrast, the S&P 500 and Dow Jones Industrial Average have been achieving multiple record highs early in 2024.
The surge in tech stocks can be attributed to Nvidia’s impressive earnings results, which were released on Wednesday. The company, known for its artificial intelligence semiconductors, exceeded already high expectations and saw its shares jump over 15%. Nvidia’s stock has surged nearly 60% this year and approximately 275% over the past 12 months. This strong performance has contributed to a broader rally in megacap tech stocks, particularly those expected to benefit from advancements in AI technology.
Nvidia’s blowout earnings have also had a positive impact on global technology shares. Japan’s Nikkei 225 stock average closed at a record high for the first time since 1989, boosted by the positive sentiment surrounding Nvidia’s results. This global rally in technology shares further supports the idea that the return of a bull market for the Nasdaq Composite is imminent.
The Nasdaq Composite’s prolonged drought following the burst of the tech bubble in 2000 has made investors cautious about declaring the return of a bull market. Despite experiencing three rallies of 40% or more during the bear market that followed the dot-com bust, none of these rallies marked the beginning of a lasting bull market. However, with the recent performance of Nvidia and other tech giants, there is a growing confidence that the Nasdaq Composite is on its way to a sustained upward trend.
In conclusion, the Nasdaq Composite is on the verge of reaching a record high thanks to a rally led by Nvidia. The tech-heavy index is close to its first record close in over two years, with Nvidia’s impressive earnings results driving the surge in tech stocks. This rally has not only impacted the Nasdaq Composite but has also had a positive effect on global technology shares. With the return of a bull market for the Nasdaq Composite appearing more likely, investors are optimistic about the future of the tech sector.
