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Nasdaq 100: 5 Stocks Are Responsible for 80% of the Gains - Is This Sustainable?

Published 06/06/2024, 02:27 AM

Stocks finished mostly higher as the Nvidia (NASDAQ:NVDA) craze continued to drive a bigger wedge between the indexes with and without Nvidia. As of today, Nvidia accounts for about 42% of the gains in the NASDAQ 100, and what is surprising is the split between the 62 advancers and the 42 decliners of the year. It was closer than I would have guessed.NDX Chart


At this point, Nvidia and Meta (NASDAQ:META) account for just a bit more than 50% of the index’s gains. So we hear about the market going up, but is the market going up, or is Nvidia going up? Is Nvidia just happening to drag names like Meta and Broadcom (NASDAQ:AVGO) up with it? Through Broadcom into the mix, we are talking about nearly 60% of the gains coming from just three stocks.

So, sitting here and trying to stare at the chart and do an Elliot wave or some kind of other analysis seems kind of pointless when just three stocks can dominate the way these three have. If you throw Microsoft (NASDAQ:MSFT) and Amazon (NASDAQ:AMZN) into the mix, we are probably talking about 80% of all of the gains in the index coming from just 4 or 5 stocks.

This is probably why the NASDAQ 100 Equal Weighted index is up just 5% on the year, compared to the NDX market cap-weighted index, which is up 14% on the year.NDX-Daily Chart

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