On Monday August 27, 2018, the Nasdaq rose 0.9% to close at 8,017.90, after notching an intraday record of 8024.94 for the first time in the history.
“New highs are a sign of strength,” says Chris Verrone, a partner at Strategas Research Partners, a New York-based investment firm.
The Nasdaq, which is up 16.1% this year after surging 28.2% in 2017, is led by the “FAANG” stocks, which are Facebook, Apple, Amazon, Netflix and Alphabet (Google’s parent company) . The group is responsible for a big chunk of the tech-dominated index’s sizable gains.
Innovation in smartphones, social media, video streaming, cloud-based computing and machine learning is boosting the fortunes of tech leaders who hold dominant positions in their respective niches, especially, Apple, the most valuable company in the U.S.
The gain in stock market on Monday is a consequence from an easing of trade tensions as the United States and Mexico announced that they have come to a new bilateral trade agreement.
The FAANG stocks have been among the biggest gainers in the record-long bull market, which has now lasted 3,548 days.
Netflix shares have risen more than 5,600% since the starting trade day in 2009, Amazon has gained more than 3,000%, while Apple has gained more than 1,700%
Tech stocks are being driven higher by investors because of strong profitability. The information technology sector of the Standard & Poor’s 500 stock index, for example, posted profit growth of more than 26% in the second quarter, with more than 90% of the companies topping Wall Street forecasts.