The Nasdaq Experiences an Unstoppable Upward Trajectory

After being the first to erase all its year-to-date losses ahead of its Wall Street counterparts, the Nasdaq hits one milestone after the other.

Technology stocks, driven heavily by the elite circle of the sector’s giant and supported by smaller tech enterprises, are to blame for the surge.

Yesterday, at the stock market’s close, the index recorded a 78-point addition to its value, ushering it to 11,555.

The already revamping manufacturing sector led the Nasdaq to go past the August Manufacturing PMI prediction of 51.9 to 53.6. This is its highest recorded increase since August 2019.

But the most notable driver of the 78-point jump is Apple’s unprecedented 5% surge, finally hitting its coveted $2 trillion market cap value. It took the technology giant decades to reach its first trillion yet only more than 24 months to get another.

Another pull is the clearer picture for coronavirus treatment that sent investors into a jovial mood.

According to analysts, tech firms will experience exponential growth in the long-term. The Nasdaq-100 index can reach 90,940 points in 2040, eight times more than the index’s current value in the market.

Shenzhen Raises the Nasdaq’s Challenger 

Game changers are often made. Yet, in some circumstances, they emerge from institutional reforms.

ChiNext, the Nasdaq’s Chinese challenger from the Shenzhen stock exchange, records historic surge among its first 18 publicly-listed companies. This signifies investors’ warm acceptance of the now loosened trade restrictions in the index.

The top performer is Ningbo KBE, an automotive cable maker, with stocks jumping 500% in morning stock trading.

Streamlined systems caused the investor frenzy for IPOs, which makes the process less bureaucratic and, therefore, more attractive for investors.

800 ChiNext listed firms trade at roughly 60 times more than their earnings, juxtaposed against 38 firms from its technology-index opposite, the Nasdaq.

The reform is a timely hedging strategy that will help Chinese tech firms with their on-going technology wars against the United States.

Despite the looming threat, the Nasdaq continues to trade in the green currently, up by 44.10 points to 11,347.48.