US stocks begin their new year on a strong note, with the Nasdaq closing above 7,000 mark for the first time, driven mainly by the bullish technology industry, reports PTI. At the closing, the technology-rich Nasdaq Composite Index had jumped 1.5 per cent to end the first session of the year at 7,006.90.
According to The Wall Street Journal, it raced to 1,000 points in just eight month – a pace not seen since the height of the technology boom. Nasdaq, which mainly focusses on technology index, jumped 28 per cent in 2017 as against the Dow Industrial average of 25 per cent and S&P 500’s 19 per cent rise, it said.
Riot Blockchain, a biotech-turned-blockchain company was the biggest winner in the run-up to the Nasdaq Composite’s latest milestone, the daily said. Large tech companies such as Apple, Google parent Alphabet and Microsoft have played a key role in it. Fox Business attributed this to rallying technology and consumer-discretionary stocks.
According to the Wall Street Journal, earnings for technology companies have soared in 2017, but they have been unable to keep up with price gains. “The tech industry and its importance in the wider economy have changed dramatically since the last boom. In the late 1990s, investors were largely betting on the promise of the internet,” it said.
“Today, with the decade-old smartphone boom and advances in areas like cloud computing and artificial intelligence, technology is deeply embedded into the way people work and do business, and has transformed industries including retail and entertainment,” the daily reported. Ryan Detrick, a senior market strategist at LPL Financial, said a good start to the year is usually followed by strong yearly performance.