Optimism has been sweeping the broader market since mid-October, when the United States and China announced the phase-one trade deal, after months of wrangling. The S&P 500 and the Nasdaq have hit several highs in this process.
And as soon as the Santa rally kicked in, the tech-heavy Nasdaq index hit the 9000-mark on Dec 26, backed by
Amazon ( AMZN Quick Quote AMZN - Free Report) , Apple ( AAPL Quick Quote AAPL - Free Report) and trade deal hopes. The Nasdaq index has now logged its 11th straight positive return, marking “ its longest winning streak since 2009.” Inside the Drivers Per Mastercard (M), holiday retail sales surged 3.4%, with online sales jumping 18.8%, marking a faster e-commerce pace than last year. E-commerce sales accounted for about 14.6% of total retail. Amazon reported record holiday sales this year. Its shares gained 4.5% on Boxing Day, while Apple, another beneficiary of Holiday season 2019, added more than 1.9%.
Apple deserves a special mention here. Notably, a slew of new gadgets, solid demand for AirPods and iPhone 11 may boost the tech behemoth’s earnings in the fourth quarter. Hopes of an imminent U.S-Sino trade deal is another positive (read:
After a Sweet November, Apple ETFs are Set for a Warm December).
Decent earnings releases, better-than-expected third-quarter U.S. GDP data, easy global monetary policy, a biotech rally and easing Brexit tensions have also been aiding the market. A pickup in the global economy is great for cyclical sectors like technology and consumer discretionary, which the Nasdaq is heavy on. After all, with U.S. economic growth appearing at a pretty good clip in the ongoing quarter and job growth steady, it makes sense to ride out the amazing growth momentum.
Earnings Trends issued on Dec 4, about 97% of the technology sector of the S&P 500 reported earnings, with a blended beat ratio of 60%. The consumer discretionary sector has come up with a blended beat ratio of 56.3%, with the space recording expansion in earnings as well as revenues. ETFs to Benefit
For investors interested in riding out this uptrend in the Nasdaq, we suggest a few ETFs that track this key American index.
Invesco QQQ ETF ( QQQ Quick Quote QQQ - Free Report)
The underlying Nasdaq-100 Index includes 100 of the largest domestic and international non-financial companies listed on the Nasdaq Stock Market based on market capitalization. The Zacks Rank #1 (Strong Buy) fund charges 20 bps in fees (read:
4 Sector ETFs That Beat the Market in Q4). Invesco DWA NASDAQ Momentum ETF
The underlying Dorsey Wright NASDAQ Technical Leaders Index is chosen from a universe of approximately 1,000 common stocks having the largest market capitalizations and traded on the NASDAQ exchange. The fund charges 60 bps in fees.
First Trust NASDAQ-100 Equal Weighted Index Fund ( QQEW Quick Quote QQEW - Free Report)
The underlying NASDAQ-100 Equal Weighted Index is the equal-weighted version of the NASDAQ-100 Index, which includes 100 of the largest non-financial securities listed on NASDAQ based on market capitalization. The fund charges 60 bps in fees.
Fidelity NASDAQ Composite Index Tracking Stock Fund ( ONEQ Quick Quote ONEQ - Free Report)
The underlying Nasdaq Composite Index is the market capitalization-weighted index of over 3,300 common equities listed on the Nasdaq stock exchange. The fund carries a Zacks Rank #2 (Buy), currently.
Direxion NASDAQ-100 Equal Weighted Index Shares ( QQQE Quick Quote QQQE - Free Report)
The underlying NASDAQ-100 Equal Weighted Index consists of companies in the NASDAQ-100 Index but each of the securities is initially set at a weight of 1.00% of the Index. The fund charges 35 bps in fees.
ProShares UltraPro QQQ ( TQQQ Quick Quote TQQQ - Free Report)
The fund offers daily investment results, before fees and expenses, that correspond to triple the daily performance of the NASDAQ-100 Index.
Megacap 300 Growth Index ETF Vanguard ( MGK Quick Quote MGK - Free Report)
Since Nasdaq rally points toward a high-momentum in growth investing, growth stocks will benefit from this trend. This Zacks #1 Ranked fund MGK measures performances of mega-capitalization growth stocks in the United States. The fund charges 7 bps in fees.
iShares Russell Top 200 Growth ETF ( IWY Quick Quote IWY - Free Report)
The Zacks Rank #1 fund follows the Russell Top 200 Growth Index. The fund charges 20 bps in fees.
SPDR Portfolio S&P 500 Growth ETF ( SPYG Quick Quote SPYG - Free Report)
This Zacks Rank #1 fund follows the S&P 500 Growth Index, which measures the performance of the large-capitalization growth sector in the U.S. equity market (read:
ETF Strategies to Ride the Wall Street Bull Run). Want key ETF info delivered straight to your inbox?
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