Dear traders, dear stock market friends.
With a score of 23,272, the Nasdaq 100 went into the weekend last Friday with another all-time high. Since the beginning of the year, the technology index is now up 10.8 %. The upward trend is in full swing and both the technical and fundamental picture point to a continuation of the bull market in the medium term.
Robust economic data
The latest economic data from the US shows that the economy remains surprisingly resilient without any noticeable increase in inflation risks. Although consumer prices rose by +0.3 % in June compared to the previous month, the strongest increase in five months, core inflation remained moderate overall. At the same time, leading indicators such as the labor market and consumer spending are signaling robust underlying momentum. However, there are also initial warning signs: incoming orders for durable capital goods, for example, were surprisingly weak in June, indicating a decline in willingness to invest.
Interest rate cut possible in September
Due to the somewhat hotter inflation data, a rate cut by the Fed at the meeting on July 29/30 is almost impossible
At the same time, Fed funds futures are pricing in a first rate hike in September with an implied probability of around 60 %. Politically, US President Trump is increasing public pressure and signaling that Fed Chairman Powell could now be open to interest rate cuts.
The bottom line is that the interest rate environment looks predictable: no acute new tightening, rather a cautiously loosening cycle. For growth and tech stocks, particularly on the Nasdaq, this basically means a tailwind; falling financing costs are supporting high valuations and could rekindle investors' appetite for risk somewhat.
AI euphoria continues
The boom in artificial intelligence (AI) continues and is still an important price driver behind the current bull market: heavyweights such as NVIDIA are benefiting from unbroken demand for AI chips and infrastructure. In mid-July, news of relaxed export restrictions helped NVIDIA's share price jump after the company announced that it would once again be allowed to supply its specialized H20 AI chip to Chinese customers.
In addition to Nvidia, the entire semiconductor sector benefited from this news. AMD, among others, also gained over 6 % and the Philadelphia Semiconductor Index (SOX) rose to its highest level in a year.
Generative AI, cloud computing and digitalization are likely to remain the most important growth drivers for Nasdaq companies in the long term. Accordingly, money quickly flowed back into tech stocks during price setbacks, underlining the resilience of the rally.
Reporting season picks up speed
In addition, the quarterly results of "Corporate America" are currently back in focus: the reporting season for Q2 2025 has so far delivered mostly positive surprises and fundamentally underpinned the record chase. Around 83 % of the US companies reported so far have exceeded analysts' earnings expectations. This exceptionally positive start to the reporting season should therefore further boost investor confidence.
The big tech companies in particular are making a significant contribution to earnings growth: Analysts are forecasting average year-on-year earnings growth of around 7-8 % for the S&P 500, with much of this growth coming from the tech giants in the Nasdaq 100. The prospect of strong figures from Microsoft, Apple, Amazon and Meta (all index heavyweights whose reports are imminent) has also recently generated optimism in advance.
Some important quarterly figures have already been published in the last few days:
- Netflix, for example, surprised with double-digit growth in revenue and subscriber numbers and raised its forecast, underlining the robustness of its media and cloud business.
- Various industrial and consumer stocks outside the tech sector - such as the shoe manufacturer Deckers - also reported unexpectedly high profits, indicating continued solid consumer demand.
- Chip giant Intel, for example, had a negative impact with a surprising quarterly loss of -0.10 $ per share instead of the expected slight profit. Intel also announced drastic cost-cutting measures, including a reduction in staff of 15 % by the end of the year. As a result, Intel shares lost around 8-10 %, which briefly put the overall strength of the AI-driven semiconductor segment into perspective.
- Particular attention was paid to the results of Tesla, one of the best-known Nasdaq stocks. The electric car pioneer suffered a decline in sales and profits in the second quarter, the second quarter in a row. Sales figures fell in key markets such as the USA and China, and profit margins were under pressure. CEO Elon Musk prepared investors for "a tough few quarters", as important tax breaks for electric vehicles in the USA expire at the end of the year, which could further dampen demand in the short term. This unpleasant news initially caused Tesla shares to plummet by almost 9 %. However, the share price partially recovered by the end of the week (+3.5 % the following day), which shows that investors continue to view the longer-term prospects (e.g. through Tesla's progress in autonomous driving and robotics) positively.
Supportive signals from the market breadth
The market breadth also confirms the upward trend: the Nasdaq Composite Index and the equally weighted QQQEW also marked new all-time highs. In the Nasdaq 100, 74 % of all stocks are currently trading above their 200-day moving average (SMA 200) - a clear signal of strength and trend confirmation. This is accompanied by a solid advance/decline development and a favorable ratio of new 52-week highs to lows, which puts the rally on a broad basis and has so far allowed setbacks to be absorbed quickly.
Author: Tobias Schmid
Date: 28.07.2025
