A bull-run that has propelled Wall Street to its best start in more than 15 years is being led by the technology-heavy Nasdaq, which in early trading on Wednesday briefly touched a threshold last seen during the aftermath of the Internet stock bubble.
The index rose 0.5 per cent above the 3,000 mark for the first time since December 2000. It later reversed gains and fell 0.3 per cent.
The Nasdaq peaked at a record 5048 in March 2000 before tumbling more than 50 per cent by the end of that year.
The Nasdaq has led the other major benchmark stock indices so far in 2012, as investors have reacted positively to liquidity efforts by the European Central Bank and a recent pick up in US consumer, labour and housing data.
The index is up almost 15 per cent for the year, compared with a 9 per cent gain for the S&P and a 6.4 per cent rise in the blue-chip Dow Jones Industrial Average.
The bulk of Nasdaq gains though has been led by a small group stocks, in particular Apple.
Shares in the company jumped after it reported blockbuster earnings last month to close at a record level on Tuesday above $535. The gains brought Apple’s market capitalisation to over $500bn, surpassing Exxon Mobile as the world’s largest publicly traded company.
Semiconductor stocks have also outperformed, with the Philadelphia Sox index of 30 semiconductor stocks up 17 per cent this year. That has been helped by a recovery in the hard disc drive supply chain, which has also seen Western Digital climb 27 per cent in the year-to-date, and Seagate Technology climb almost 60 per cent.
“It’s becoming a bit of a fashion for some analysts to strip Apple gains from the index. But despite Apple’s very strong performance, it is not an isolated case. The tech sector as a whole has been benefiting from increased consumer spending and business investment in technology,” said Brad Sorensen, director of market and sector research at Charles Schwab.
One exception has been Internet-giant Google. The second-most heavily traded Nasdaq stock is trailing the index by 3.5 per cent year-to-date, weighed by disappointing fourth-quarter results. But shares in the company are still up in the last 52-weeks, with a gain of 3.8 per cent.
Additional reporting by Ajay Makan.
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