Nasdaq 100 Index
- By date
- Metadoro first
When the pre-Christmas week was just beginning, the global investment sentiment had been fuelled by record-breaking earnings of a great chipmaker for gadgets and data centers Broadcom. The bullish appetites were sparked as that was the last big tech company to report before the year-end, and it luckily projected a better trend for chip demand from flagship customers like Apple, Samsung, Huawei and Cisco.
The value of Broadcom added more than 35% within a couple of trading days to hit $1 trillion or over $250 per share. This was around an annual target area for the firm according to estimates of many reputable investing houses. The tech-heavy Nasdaq Composite index exceeded a psychological mark of 20,000 points.
The two achievements in sync prompted a natural wave of massive profit taking by a happy but still wary crowd, due to much weaker prospects provided by some other AI era leaders like Adobe and Oracle, especially ahead of the last Federal Reserve’s policy decision in 2024. Thus, the widespread stock rally was stopped and faced an even deeper 3% retracement from fresh peaks in terms of the S&P 500 broad market barometer. The S&P 500 had to retrace from above 6,050 to below 5,850 points on Wednesday night of December 18, as a response to the U.S. central bank’s relentless remarks. Its chair Jerome Powell clarified that policymakers shifted their road map from previously supposed three or four interest rate cut moves to only two small 0.25% steps to lower borrowing costs in a very narrow and careful way. Too high levels of normalised rates restrict access to cheap credit resources, being negative for stocks, yet this impact is limited in time and scale due to a solid labour market, hopes for soft landing, running away from inflation to assets and lower rates in other countries. A rate differential factor is also boosting yields of the U.S. public debt, which led the Greenback index to fresh 24-month highs above 108 points, suppressing gold prices.
Nasdaq 100 Index
Being a pure tech index, it has some unique features:
- The NASDAQ index is heavily affected by market capitalisation of the companies, which have its stocks inside the index. Thus, corporates like Apple, Amazon, Facebook, Intel, Microsoft, NVidia, Tesla, and other tech giants’ stocks have a strong impact on index movements. Tech sector stocks are responsible for 50% of the market cap of the index, for 20% of the consumer sector and 10% of healthcare;
- The index is currently outrunning the S&P 500 index as it has risen by 80% above the latter over the last decade;
- The NASDAQ index is affected by the economic situation and data, including U.S. GDP, wages, investments, and retail sales. The Federal Reserve’s (Fed) decisions have a significant impact on the index. Lower interest rates and easing monetary policy by the Fed have a positive effect on the index. All these developments should be monitored while investing in this asset;
- The Consumer Price Index (CPI) and Personal Consumption Expenditures (PCE) indexes have a significant impact on the index. When inflation is far above the target at 2%, its increase is negative for the index, as it contributes to the monetary tightening by the Fed. Weak inflation below the target supports the index;
- The NASDAQ index is a risky asset, and is affected by risk appetite. But it has no major influence on the risk appetite itself as it is a sectoral index measuring the performance of tech stocks. The performance of the S&P 500 index and the CBOE Volatility index (VIX) should be monitored to understand risk appetite changes;
- Artificial Intelligence, and other specific tech stories exclusively affect the index. Bottlenecks in logistics and trade wars in high tech segments push the index down much stronger than the stock market in general;
- The index could be traded via CFD’s, futures, or designated ETF’s.
| Ticker | USTech100 |
| Contract value | 10 USD x USTech100 Index |
| Maximum leverage | 1:100 |
| Date | Short Swap (%) | Long Swap (%) | No data |
|---|
| Minimum transaction volume | 0.01 lot |
| Maximum transaction volume | 100 lots |
| Hedging margin | 50% |
| USD Exposure | Max Leverage Applied | Floating Margin |
|---|
