On January 10th local time, the three major US stock indexes collectively closed higher. As of the close, the Dow Jones Industrial Average was at 37695.73 points, up 0.45%; The S&P 500 index closed at 4783.45 points, up 0.57%; The Nasdaq closed at 14969.65 points, up 0.75%. The Nasdaq 100 index, mainly composed of technology stocks, closed at 16793.05 points, up 0.69%, recording four consecutive gains.
Most large technology stocks rose, with Facebook parent company Meta rising more than 3%, Nvidia rising more than 2% to reach a new closing high, Microsoft rising nearly 2%, Amazon rising more than 1%, and Google A and Apple slightly rising; Intel fell more than 1%, while Tesla fell slightly.
Funds continue to borrow from relevant ETFs and invest in US technology stocks. On the previous trading day, the Nasdaq 100ETF (159659) received a net inflow of approximately 5.23 million yuan, representing a net inflow of 12.95 million yuan for five consecutive days. According to Wind data statistics, among the ETF products that also track the NASDAQ 100 index, the NASDAQ 100 ETF (159659) is one of the products with the lowest management fee, which is conducive to investors laying out global technology leaders at a lower cost.
The large technology stocks known as the "Magnificent Seven" by Wall Street have become an important driving force for the rise of the US stock market in 2023- Apple, Microsoft, Google, Amazon, Nvidia, Tesla, and Meta saw an average annual increase of 105%, while Nvidia and Facebook led all Nasdaq 100 constituent stocks with gains of 239% and 194%, respectively.
From a fundamental perspective, the higher market value proportion of technology leaders in the US stock market is not a "tree without roots". Bank of Communications International pointed out that from an industry perspective, technology industries such as information technology and communication services have benefited the most from the rapid development of the AI ecosystem. Although market expectations are already at a high level, the performance of these two sectors in the third quarter of 2023 financial reports still exceeded expectations, with companies accounting for 89.2% and 85.7%, respectively. This indicates that there is still actual performance realization as support under high expectations.
Source: Bank of Communications International
From the perspective of technology leaders, the growth rate of performance has significantly increased. CICC analysis pointed out that on the one hand, leading technology companies have reduced costs and increased profitability through layoffs and other means, and sales and management expenses have continued to decline since the fourth quarter of 2022. On the other hand, the AI application boom has also boosted the revenue and profitability of companies in related fields. Technology leaders (Meta, Apple, Amazon, Microsoft, Nvidia, Google) have seen a significant increase in year-on-year profit growth for three consecutive quarters, from -32.1% in the fourth quarter of 2022 to 11.7% in the third quarter of 2023.
Therefore, China International Capital Corporation (CICC) believes that due to the low growth pressure in the United States, the early release of profit reduction pressure by NASDAQ in 2022, and the loose hedging by the Federal Reserve, there is no concern about the deep adjustment pressure on the US stock market.
"Global Technology Leader Wind Vane" - NASDAQ 100ETF (159659)
As one of the representative market indexes in the US market, the NASDAQ index is also called the "US tech index". The NASDAQ 100 index is based on the NASDAQ index and refined with essence. It selects 100 non-financial companies as constituent stocks, and calculates the index according to the corresponding index compilation rules on the basis of market capitalization weighting, reflecting the overall market of NASDAQ or the trend of US high-tech.
The NASDAQ 100 ETF (159659) closely tracks the NASDAQ 100 index, efficiently lays out high-quality overseas technology stocks, and has over-the-counter linked funds (Class A: 019547, Class C: 019548) for off exchange investors to choose from.