The post crisis 2009 stock market rally has been led by technology companies. The NASDAQ finally exceeded the internet bubble highs from 2000 after fifteen hard years to recovery.
The basket of non-financial stocks has outperformed other major markets as tech has led the way higher.
Stocks saw new all time records before a year end retreat.
The NASDAQ finished plus 6% in 2015 to lead performance compared to the S&P 500 unchanged and the DOW negative.
The breadth of the rally was not broad as only a few select stocks carried the NDX NASDAQ 100 index. The “FANG” stocks of Facebook, Apple or Amazon, Netflix and Google led technology higher in 2015, with solid performance in the most impactful stocks in the index.
The new year has seen the FANG stocks bite investors with the NDX diving to near double digit losses.
Earnings season kicking into gear will provide a clearer picture of stock resiliency after the correction. Fundamentals have trumped fear in the past to support nervous markets.
Innovative companies that adapt and innovate have reshaped our world. Technology has dramatically changed lives in ways never imagined.
The future remains bright with productivity and pleasure on the rise.
The October 2014 and August 2015 NDX tech declines fully recovered in short order with new market highs each time. Until proven otherwise, the bull market remains intact with FANG stocks always ready to attack.
The lesson to be learned is that just a few heavily weighted stocks in an index may have a disproportionate impact on performance, both good and bad.
