2020 may well have been the year of the massive rises in the value of stocks of Silicon Valley-based big tech companies, largely because their area of ‘tech’ is around e-commerce, social networks, online streaming services and internet access.
This new era of what constitutes technology – online services rather than mechanical engineering – means that during 2020, when many governments instigated the closure of shops and workplaces, whole populations were forced to do almost everything online.
The Silicon Valley giants went from strength to strength.
Given the newfound way of life in which everything from groceries to entertainment is just a click away, it would be easy to consider that this band of internet giants would continue to bolster the US stock market.
This was not the case, and parts of 2021 and 2022 represented a period of tech stock volatility. As most technology firms are listed on the NASDAQ exchange in New York, the NASDAQ Composite Index showed a very varied pattern, including a sustained period in which tech stocks were depreciating rapidly.
That may well have been a surprise for many investors, especially during the halo effect that the new Special Purchase Acquisition Company (SPAC) listings were giving to the tech-friendly exchange. At that time, relatively new companies that few people had heard of were suddenly bypassing the majority of entry requirements and listing for valuations of tens of millions of dollars on the NASDAQ exchange.
This fad has now passed, and the NASDAQ Composite Index had lulled for some time.
Today, however, the index begins the trading day at its highest point in an entire year.
Yesterday’s close of business resulted in the index reaching 13,816.77, which is a staggering 2,494 points higher than this time last year. During the past three months, the NASDAQ Composite Index has been consistently rising in value, and today’s peak is of great interest.
