The tech world has been on a bumpy ride lately, but those who held on tight are finally being rewarded. The Nasdaq Composite, known for its heavy focus on tech stocks, has experienced a whopping six straight weeks of positive gains – the longest stretch since the pre-Covid era of January 2020. This boost can be attributed to a variety of factors, including a strong jobs report in May and the Senate’s recent passage of a crucial debt ceiling bill.
Despite lacking any major headlines this week, the Nasdaq’s top dogs are in the green, with Tesla leading the way. The electric car pioneer saw an impressive 11% surge in shares this week, resulting in a total increase of 74% since the beginning of the year. This is a remarkable recovery, considering the company suffered major losses of up to two-thirds in 2022.
Another tech giant that helped the Nasdaq shine is Nvidia, which has seen a 169% climb in shares this year alone. These two tech titans, along with others, led the Nasdaq up a staggering 27% in 2023, easily outpacing the S&P 500 and Dow Jones Industrial Average.
While still on the road to recovery, the Nasdaq is still a distance from its previous all-time high. According to Danielle Shay, Vice President of Options at Simpler Trading, the focus is on mega-cap tech and semiconductor companies.
In the realm of cloud software, earnings reports are still providing strong support, with companies like MongoDB showing impressive gains of 33% this week. The cloud-based database developer reported earnings and revenue that surpassed analysts’ expectations and raised its guidance for fiscal year 2024.
However, some tech companies experienced the other side of the coin. Cybersecurity vendor SentinelOne endured a drastic 35% plummet in share prices after the company announced a disappointing forecast and layoffs. Citing a decline in technology usage by large customers, Chief Financial Officer David Bernhardt expressed gloom about the near future. Meanwhile, software developer PagerDuty also disappointed investors, dropping 14% for the week following a revision of its forecast for the year.
All in all, tech investors have had their mettle tested in 2022, but the resilience of the industry and its biggest players is evident in the prolonged gains they have made this year. Watch this space to see what innovative breakthroughs will further bolster the Nasdaq’s trajectory.