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The Zacks Analyst Blog Highlights Invesco QQQ Trust, Invesco NASDAQ 100 ETF, Invesco NASDAQ Next Gen 100 ETF, Fidelity Nasdaq Composite Index ETF and Simplify Nasdaq 100 PLUS Convexity ETF
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For Immediate Release
Chicago, IL – May 31, 2023 – Zacks.com announces the list of stocks and ETFs featured in the Analyst Blog. Every day the Zacks Equity Research analysts discuss the latest news and events impacting stocks and the financial markets. ETFs recently featured in the blog include: Invesco QQQ Trust (QQQ - Free Report) , Invesco NASDAQ 100 ETF (QQQM - Free Report) , Invesco NASDAQ Next Gen 100 ETF (QQQJ - Free Report) , Fidelity Nasdaq Composite Index ETF (ONEQ - Free Report) and Simplify Nasdaq 100 PLUS Convexity ETF (QQC).
Here are highlights from Tuesday’s Analyst Blog:
Nasdaq ETFs Won in May: Further Rally Expected Ahead
Proving the famous adage "Sell in May and Go Away" wrong, the Nasdaq recorded five consecutive weeks of gains and added approximately 6% over the past month, led by the AI-powered charge of mega-cap Tech.
The Nasdaq Composite has established a substantial lead over the Dow Jones Industrial Average this year, with a margin of outperformance reaching over 19%. This is the widest margin of outperformance seen since 1991, according to Dow Jones Market Data, as quoted on MarketWatch.
Based on the Dow Jones Market Data, this marks the first time since the Nasdaq's inception in 1971 that the index has recorded a year-to-date increase of more than 21% while the Dow has remained in negative territory for the year.
What’s Behind Nasdaq’s Gain
Chances of the Federal Reserve cutting interest rates or staying put, lower Treasury yields, U.S. recession fears, continued regional banking crisis in the United States and the AI mania are driving interest in mega-cap technology names, which appear to be safe bets.
Also, investors seeking security amid concerns ranging from the debt ceiling to a potential U.S. banking crisis have found solace in mega-cap stocks like Google parent company Alphabet, Microsoft Corp., and Amazon.com. These stocks have garnered appeal due to their robust financial positions and reliable cash flows, making them enticing investment options in recent months.
Last year was troublesome for these stocks. Their valuation got corrected massively, which led to a rally this year on lower rates. Inflation is showing signs of easing finally and this acts as a tailwind for the tech-heavy Nasdaq. The Nasdaq is growth-oriented and performs better in a low-rate environment.
What Lies Ahead?
Concerns about the Federal Reserve's monetary policy tightening and the recent turmoil in the banking sector are likely to persist even if the debt deal is cracked. Overall, there is anticipation for a broader equity will rally. The excitement surrounding artificial intelligence and its association with mega-cap companies will provide further support to the tech stock category.
Plus, Silicon Valley layoffs have been intense. Amazon, Meta, Alphabet, Twitter, Salesforce – most of the tech giants have been on layoff spree. Such layoffs and cost reduction may boost profitability of the tech companies. This is another reason for the recent tech rally.
What Does Valuation Say?
Per Morningstar data, price/forward earnings of the Nasdaq stand at 20.00X, while the past decade’s historical data reveal that the highest P/E was 27.55X hit in 2021. This means the index is trading at a 27.4% discount to the decade high P/E, indicating further run from here.
ETFs in Focus
Against this backdrop, below we highlight a few Nasdaq ETFs so that interested investors can play the ongoing rally.
Invesco QQQ Trust
Invesco NASDAQ 100 ETF
Invesco NASDAQ Next Gen 100 ETF
Fidelity Nasdaq Composite Index ETF
Simplify Nasdaq 100 PLUS Convexity ETF
Want key ETF info delivered straight to your inbox?
Zacks’ free Fund Newsletter will brief you on top news and analysis, as well as top-performing ETFs, each week.
Past performance is no guarantee of future results. Inherent in any investment is the potential for loss. This material is being provided for informational purposes only and nothing herein constitutes investment, legal, accounting or tax advice, or a recommendation to buy, sell or hold a security. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. It should not be assumed that any investments in securities, companies, sectors or markets identified and described were or will be profitable. All information is current as of the date of herein and is subject to change without notice. Any views or opinions expressed may not reflect those of the firm as a whole. Zacks Investment Research does not engage in investment banking, market making or asset management activities of any securities. These returns are from hypothetical portfolios consisting of stocks with Zacks Rank = 1 that were rebalanced monthly with zero transaction costs. These are not the returns of actual portfolios of stocks. The S&P 500 is an unmanaged index. Visit https://www.zacks.com/performance for information about the performance numbers displayed in this press release.
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The Zacks Analyst Blog Highlights Invesco QQQ Trust, Invesco NASDAQ 100 ETF, Invesco NASDAQ Next Gen 100 ETF, Fidelity Nasdaq Composite Index ETF and Simplify Nasdaq 100 PLUS Convexity ETF
For Immediate Release
Chicago, IL – May 31, 2023 – Zacks.com announces the list of stocks and ETFs featured in the Analyst Blog. Every day the Zacks Equity Research analysts discuss the latest news and events impacting stocks and the financial markets. ETFs recently featured in the blog include: Invesco QQQ Trust (QQQ - Free Report) , Invesco NASDAQ 100 ETF (QQQM - Free Report) , Invesco NASDAQ Next Gen 100 ETF (QQQJ - Free Report) , Fidelity Nasdaq Composite Index ETF (ONEQ - Free Report) and Simplify Nasdaq 100 PLUS Convexity ETF (QQC).
Here are highlights from Tuesday’s Analyst Blog:
Nasdaq ETFs Won in May: Further Rally Expected Ahead
Proving the famous adage "Sell in May and Go Away" wrong, the Nasdaq recorded five consecutive weeks of gains and added approximately 6% over the past month, led by the AI-powered charge of mega-cap Tech.
The Nasdaq Composite has established a substantial lead over the Dow Jones Industrial Average this year, with a margin of outperformance reaching over 19%. This is the widest margin of outperformance seen since 1991, according to Dow Jones Market Data, as quoted on MarketWatch.
Based on the Dow Jones Market Data, this marks the first time since the Nasdaq's inception in 1971 that the index has recorded a year-to-date increase of more than 21% while the Dow has remained in negative territory for the year.
What’s Behind Nasdaq’s Gain
Chances of the Federal Reserve cutting interest rates or staying put, lower Treasury yields, U.S. recession fears, continued regional banking crisis in the United States and the AI mania are driving interest in mega-cap technology names, which appear to be safe bets.
Also, investors seeking security amid concerns ranging from the debt ceiling to a potential U.S. banking crisis have found solace in mega-cap stocks like Google parent company Alphabet, Microsoft Corp., and Amazon.com. These stocks have garnered appeal due to their robust financial positions and reliable cash flows, making them enticing investment options in recent months.
Last year was troublesome for these stocks. Their valuation got corrected massively, which led to a rally this year on lower rates. Inflation is showing signs of easing finally and this acts as a tailwind for the tech-heavy Nasdaq. The Nasdaq is growth-oriented and performs better in a low-rate environment.
What Lies Ahead?
Concerns about the Federal Reserve's monetary policy tightening and the recent turmoil in the banking sector are likely to persist even if the debt deal is cracked. Overall, there is anticipation for a broader equity will rally. The excitement surrounding artificial intelligence and its association with mega-cap companies will provide further support to the tech stock category.
Plus, Silicon Valley layoffs have been intense. Amazon, Meta, Alphabet, Twitter, Salesforce – most of the tech giants have been on layoff spree. Such layoffs and cost reduction may boost profitability of the tech companies. This is another reason for the recent tech rally.
What Does Valuation Say?
Per Morningstar data, price/forward earnings of the Nasdaq stand at 20.00X, while the past decade’s historical data reveal that the highest P/E was 27.55X hit in 2021. This means the index is trading at a 27.4% discount to the decade high P/E, indicating further run from here.
ETFs in Focus
Against this backdrop, below we highlight a few Nasdaq ETFs so that interested investors can play the ongoing rally.
Invesco QQQ Trust
Invesco NASDAQ 100 ETF
Invesco NASDAQ Next Gen 100 ETF
Fidelity Nasdaq Composite Index ETF
Simplify Nasdaq 100 PLUS Convexity ETF
Want key ETF info delivered straight to your inbox?
Zacks’ free Fund Newsletter will brief you on top news and analysis, as well as top-performing ETFs, each week.
Get it free >>
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Past performance is no guarantee of future results. Inherent in any investment is the potential for loss. This material is being provided for informational purposes only and nothing herein constitutes investment, legal, accounting or tax advice, or a recommendation to buy, sell or hold a security. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. It should not be assumed that any investments in securities, companies, sectors or markets identified and described were or will be profitable. All information is current as of the date of herein and is subject to change without notice. Any views or opinions expressed may not reflect those of the firm as a whole. Zacks Investment Research does not engage in investment banking, market making or asset management activities of any securities. These returns are from hypothetical portfolios consisting of stocks with Zacks Rank = 1 that were rebalanced monthly with zero transaction costs. These are not the returns of actual portfolios of stocks. The S&P 500 is an unmanaged index. Visit https://www.zacks.com/performance for information about the performance numbers displayed in this press release.