- The Nasdaq Composite Index peaked at 10,310.36 on Thursday, a new record.
- Technology and communication stocks continue to outperform the broader stock market.
- A better than expected jobs report fueled investor appetite ahead of the Independence Day long weekend.
The Nasdaq Composite Index surged to new all-time highs Thursday, extending its streak of market-beating returns in the face of a pandemic. The tech-focused index has now returned more than 14% year-to-date, as big tech continues to thrive in a post-lockdown world.
Nasdaq Extends Record Rally; S&P 500, Dow Jones Rise
All of Wall Street’s major indexes are trading in positive territory Thursday, as investors rallied behind stronger than expected employment data. The Nasdaq Composite Index surged to an intraday peak of 10,310.36. It was last up 1.1% and on track to settle at new record highs.
Within the Nasdaq 100, Tesla (NASDAQ:TSLA) is the standout performer, gaining more than 7%. The electric car maker peaked at an all-time high of $1,228.00 for a total market cap of $223 billion.
The broad S&P 500 Index of large-cap stocks rallied 0.9%. The Dow Jones Industrial Average briefly surpassed 26,000 before paring gains; it was last up 234 points, or 0.9%.
The New York Stock Exchange will be closed on Friday to observe Independence Day.
These Stocks Are Fueling the Nasdaq’s Gains
Shares of information technology companies have outperformed the broader equities market amid the pandemic.
Companies like Amazon (NASDAQ:AMZN), Netflix (NASDAQ:NFLX), Zoom (NASDAQ:ZM) benefit from people staying at home, so their businesses have thrived amid nationwide shelter-in-place orders. Online retailers like JD.com (NASDAQ:JD) and Ebay (NASDAQ:EBAY) have also surged.
Video game developers like Activision Blizzard (NASDAQ:ATVI) and Electronic Arts (NASDAQ:EA) have quietly outperformed the market this year.
The Nasdaq’s biotechnology scene is also a source of tremendous growth, with the likes of Regeneron Pharmaceuticals (NASDAQ:REGN) gaining more than 63% year-to-date.
In the past six months, Tesla has been the Nasdaq’s top performer, gaining more than 140%. The stock is on fire thanks to back-to-back quarters of profitability, rising deliveries, and higher price target from Wall Street firms.
Although the Nasdaq is drawing concerning parallels with the dotcom bubble 20 years ago, the index is far less tech-dependent than it was during the last major bubble. This time around, roughly 50% of the index is devoted to technology.
Like the broader market, the Nasdaq’s outlook is also governed by central-bank intervention in an economy that’s still on life support due to the pandemic. Analysts warn that the growing disconnect between stocks and the economy could have drastic implications for the bull market.
Last modified: July 2, 2020 5:20 PM UTC