The Nasdaq Composite (INDEXNASDAQ: .IXIC) ascended above the 20,000 point mark for the first time in 53 years on Wednesday. Its rally was fueled by investor enthusiasm for big tech and optimism about Trump’s potential policy changes in the new year.
That number is calculated based on the value of stocks in the index, which are weighted differently based on their market capitalization. It took about four years for the index to rise from 10,000 points to its current value.
This rapid growth can be attributed to the emergence and adoption of artificial intelligence, tech developments in cybersecurity and other sectors, digital transformation inspired by pandemic conditions and less notable factors.
The so-called “tech-heavy index” was propelled to new heights this week by major stocks like Broadcom Inc (NASDAQ: AVGO), Alphabet Inc Class A (NASDAQ: GOOGL), and NVIDIA Corp (NASDAQ: NVDA) — all of which were up and in the green on Wednesday.
Also, Tesla Inc (NASDAQ: TSLA). Elon Musk’s shares just hit an all-time high too at US$424.77 apiece. He just became the first person in history to have a net worth exceeding US$400 billion.
Most of the other “Magnificent 7” stocks — Microsoft Corp (NASDAQ: MSFT), Amazon.com Inc (NASDAQ: AMZN) and Meta Platforms Inc (NASDAQ: META) — were up on the Nasdaq Wednesday as well. Apple Inc (NASDAQ: AAPL) was the only one in the red.
They have a combined market capitalization of approximately US$17 trillion. Broadcom is the only one mentioned that is not considered to be part of this group.
🚨 Nasdaq soars past 20,000, marking an all-time high! 🚀
Fueled by AI, cloud, and tech innovation, the index reflects a historic shift in market leadership. The bull run shows no signs of slowing.pic.twitter.com/cJJmabyzOB
— Nigel D'Souza (@Nigel__DSouza) December 11, 2024
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CFRA Research has other recommendations
Analysts from this Virginia-based analytics firm generally recommend buying Magnificent 7 stocks, but they have other suggestions too.
CFRA says that Adobe Inc (NASDAQ: ADBE); the AI and software company ServiceNow Inc (NYSE: NOW); IBM Common Stock (NYSE: IBM); and the Fortune 500 IT operator Accenture Plc (NYSE: ACN) are worthwhile big tech investments too.
Additionally, Advanced Micro Devices, Inc. (NASDAQ: AMD); and the cloud software specialist Salesforce Inc (NYSE: CRM).
Out of all the stocks in discussion, IBM and Broadcom pay the best dividends.
rowan@mugglehead.com
