5 Stocks in Nasdaq ETF Fueling Index's Big Comeback Since 2008
The tech-heavy Nasdaq Composite Index saw the largest intraday swing since 2008 in the April 8 trading session. The index closed 0.1% higher yesterday after swinging from a loss of around 5.2% to a gain of 4.5% at intraday extremes, marking its largest intraday comeback since Oct. 10, 2008. Fidelity Nasdaq Composite Index ETF ONEQ, which tracks the Nasdaq Composite Index, also saw wild swings of 10% from high to low in a single day and closed 0.1% lower. While most of the stocks in the ETF portfolio have rebounded strongly, we have highlighted five that were at the forefront of the historic comeback. These are Rhythm Pharmaceuticals Inc. RYTM, Golden Ocean Group Limited GOGL, Rigetti Computing Inc. RGTI, Super Micro Computer Inc. SMCI and Garrett Motion Inc. GTX.Rumors of a 90-day pause in U.S. tariffs under Donald Trump triggered a dramatic $2.5 trillion surge in American stock markets that lasted only for seven minutes. The short-lived rally offered some relief to investors amid anxiety surrounding Trump's trade policy and the volatility of global financial markets (read: 5 Top-Ranked Stocks of Nasdaq ETF Beating the Bear Market).Additionally, bargain hunters stepped in to cash in on the beaten-down prices after the Nasdaq tumbled to a bear market. In particular, seasoned investors and institutional buyers saw an opportunity in the chaos as most of the stocks in the index traded at steep discounts, making them attractive. Notably, the 'Magnificent Seven' stocks shed $1.8 trillion in market cap last week following the April 2 tariff announcement.Algorithmic and high-frequency traders likely played a role as well, accelerating the upside as the index appeared to hit the bottom.
Though the AI boom, which led the tech sector and the broad market rally over the past year, has fizzled, increased tech spending will continue to drive growth despite the economic slowdown and higher inflation. U.S. tech spending is expected to grow 6.1% to reach a staggering $2.7 trillion, buoyed by the Fed rate cut. Per the latest data, traders ramped up the bets on the number of Fed cuts this year to five and pulled forward their estimate of when those cuts could begin, starting at the next meeting on May 6-7. The odds of a May cut are now above 50%. Lower interest rates generally lead to reduced borrowing costs that help businesses expand their operations more easily and increase profitability. This, in turn, minimizes the impact of tariffs on the economy and provides a boost to the stock market.
Fidelity Nasdaq Composite Index ETF holds a broad basket of 906 stocks with heavy concentration on the top 10 holdings. It has AUM of $6.1 billion. Information technology is the top sector with a 48% share, followed by consumer services (15.5%), consumer discretionary (15%) and healthcare (6.3%). ONEQ charges 21 bps in annual fees and trades in an average daily volume of 398,000 shares. It has a Zacks ETF Rank #3 (Hold) with a Medium risk outlook.
Rhythm Pharmaceuticals is a biopharmaceutical company focused on the development and commercialization of peptide therapeutics for the treatment of rare genetic deficiencies, which result in life-threatening metabolic disorders. The stock soared 17.1% in yesterday's trading session and has an estimated earnings growth rate of 41.9% for this year. Rhythm Pharmaceuticals has a Zacks Rank #3 (Hold) and a Growth Score of B. Golden Ocean is a shipping company engaged in the transportation of dry bulk cargoes. It operates primarily in the Capesize and Panamax markets. The stock jumped 11.9% yesterday and has an estimated earnings growth rate of 4.9% for this year. Golden Ocean has a Zacks Rank #2 (Buy) and a Value Score of B. You can see the complete list of today's Zacks #1 (Strong Buy) Rank stocks here.Rigetti is a pioneer in full-stack quantum-classical computing. It has an estimated earnings growth rate of 44.1% for this year and gained about 11% yesterday. RGTI has a Zacks Rank #2.Super Micro designs, develops, manufactures and sells energy-efficient, application-optimized server solutions based on the x86 architecture. The stock has gained 10.7% and has an estimated earnings growth rate of 15.4% for fiscal year (ending June 2025). It has a Zacks Rank #2.Garrett Motion provides transportation systems, offering turbochargers, engines, diesel tanks and other related parts. The stock was up about 10% yesterday and delivered an earnings surprise of 26.18% in the last four quarters. It has a Zacks Rank #2 and a Growth Score of A.
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Super Micro Computer, Inc. (SMCI) : Free Stock Analysis Report
Golden Ocean Group Limited (GOGL) : Free Stock Analysis Report
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Rhythm Pharmaceuticals, Inc. (RYTM) : Free Stock Analysis Report
Garrett Motion Inc. (GTX) : Free Stock Analysis Report
Rigetti Computing, Inc. (RGTI) : Free Stock Analysis Report
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