Wall Street witnessed strength in all the broad indexes on Jun 22. The tech-heavy Nasdaq Composite surged to an all-time high and rose 0.8% while hitting a fresh intraday record on the same day. Also, the S&P 500 and the Dow Jones Industrial Average climbed 0.5% and 0.2%, respectively, in the period.
It is observed that strong performances by some major tech players drove the index to an all-time high. Among the prominent players, Netflix (
NFLX Quick Quote NFLX - Free Report) inched up 2.3%. Moving on, Amazon ( AMZN Quick Quote AMZN - Free Report) , Apple ( AAPL Quick Quote AAPL - Free Report) and Microsoft (MSFT) were all up at least 1% on Tuesday. In addition, Facebook (FB) climbed 2%.
Investors kept the Wall Street rally tight in the recent past, largely due to their growing concerns over the rising inflation levels. They were worried that increasing inflation may hurt corporate margins and profits. They also feared that this persistent escalation in inflation may put pressure on the Federal Reserve to tighten monetary policy, according to a CNBC article.
Notably, the indices soared high while Fed Chairman Jerome Powell was testifying before the House of Representatives on Jun 22, per the verified sources. Going by a CNBC article, Powell remained bullish on the economic recovery achieved so far from the pandemic-led slump. He also maintained that high inflation levels were temporary and will return to 2% over the long term, per the same article.
In this regard, Powell said that “Since we last met, the economy has shown sustained improvement. Widespread vaccinations have joined unprecedented monetary and fiscal policy actions in providing strong support to the recovery. Indicators of economic activity and employment have continued to strengthen, and real GDP this year appears to be on track to post its fastest rate of increase in decades,” as mentioned in a CNBC report.
Furthermore, amid the coronavirus pandemic, technology is playing a pivotal role in our lives. Thus, the expanding work-from-home and online-shopping trend, increasing digital payments, growing video streaming and mounting video game popularity have gradually become the ‘new normal’. Also, market experts believe that products and services from these tech giants will continue to be a major requirement in day-to-day life.
ETFs to Gain
Investors seeking to ride the Nasdaq bulls could consider the following ETFs. These funds might see massive trading volumes in the days ahead if the afore-mentioned trends stay:
ProShares UltraPro QQQ ( TQQQ Quick Quote TQQQ - Free Report)
For a more bullish approach, TQQQ could be an excellent choice. It also tracks the Nasdaq-100 Index but offers thrice the returns of the daily performance, while charging 95 basis points (bps) in expense ratio. The fund has managed AUM of $11.33 billion (read:
10 Most-Heavily Traded ETFs). ProShares Ultra QQQ ( QLD Quick Quote QLD - Free Report)
Investors seeking to make big gains in a short span can bet on QLD. It provides twice the return of the Nasdaq-100 Index’s daily performance. The fund has AUM of $4.51 billion. It charges 95 bps in fees and expenses (read:
ETFs to Play as Nasdaq Stands Strong Despite Reflation). Invesco QQQ ( QQQ Quick Quote QQQ - Free Report)
This ETF provides exposure to 102 largest domestic and international non-financial companies listed on the Nasdaq and is based on the Nasdaq-100 Index. QQQ is one of the largest and most popular ETFs in the large-cap space, with AUM of $168.26 billion. It charges investors 20 bps in annual fees (read:
5 Hot Stocks That Pushed Nasdaq ETF to New Highs). Fidelity Nasdaq Composite Index ETF ( ONEQ Quick Quote ONEQ - Free Report)
This ETF tracks the NASDAQ Composite index, holding a broad basket of 1,021 stocks. It has AUM of $4.14 billion. The expense ratio comes is 0.21% (read:
Big Tech Earnings Wave to Push Nasdaq ETFs Higher). First Trust NASDAQ-100 Equal Weighted Index Fund ( QQEW Quick Quote QQEW - Free Report)
Holding 102 stocks, this fund replicates as closely as possible, before fees and expenses, the price and yield of the NASDAQ-100 Equal Weighted Index. It has amassed $1.23 billion in its asset base and charges 58 bps as fees.
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