The Nasdaq 100 tracks the 100 largest non-financial companies listed on the Nasdaq — Apple, Microsoft, Nvidia, Amazon, Alphabet, Meta, Tesla, Broadcom, TSMC ADR, and Costco lead the index. It is the world's benchmark for technology and innovation-driven stocks.
Technology companies are "long duration" assets — most of their expected cash flows are weighted far into the future. When US 10-year Treasury yields rise from 4% to 5%, the present value of those future cash flows falls significantly. The 2022 Nasdaq bear market (down 35%) was almost entirely explained by rising bond yields, not deteriorating business fundamentals — most Nasdaq constituents continued growing revenue throughout.
Nvidia's quarterly earnings report — which typically comes in late November, late February, late May, and late August — is the single most market-moving earnings release in global markets today, capable of moving the Nasdaq 2–4% overnight. The reason: Nvidia's data center GPU revenue is the direct measure of how much hyperscalers (Microsoft Azure, Amazon AWS, Google Cloud) are spending on AI infrastructure. When Nvidia beats and raises guidance, it confirms the AI capex cycle is intact.
Nvidia alone represented 8–10% of the Nasdaq 100 at peak. The index's performance is heavily tied to AI GPU demand, cloud computing capex, and AI model development spend.
Nifty IT correlates with Nasdaq 100 at 0.65–0.80 on most trading days. When Nasdaq falls sharply on macro concerns, Indian IT opens gap down regardless of individual company fundamentals — TCS can have strong order books but will still open lower if Nasdaq fell 2% on Fed fears. This makes Nasdaq direction the single highest-priority check for Indian IT traders each morning.
The quarterly results from Amazon (AWS revenue growth), Microsoft (Azure growth rate and commercial bookings), and Alphabet (Google Cloud revenue) are collectively the most important earnings data points for Nasdaq direction. When all three cloud platforms report accelerating growth in the same quarter, institutional investors read it as confirmation of broad enterprise tech spending recovery — triggering index-level buying that lifts the Nasdaq across all sub-sectors.
The ratio of Nasdaq 100 to S&P 500 (NDX/SPX ratio) is a useful indicator of growth vs value sentiment. When the ratio is rising, markets are in risk-on growth mode — tech is leading. When the ratio is falling, rotation into value, financials, energy, and defensives is occurring. Historical patterns: the ratio peaks near market tops (1999-2000, 2021) and troughs near sentiment nadirs (2002, late 2022).
Four times per year — on the third Friday of March, June, September, and December — the simultaneous expiry of stock options, stock index futures, and stock index options creates "Triple Witching" in US markets. On these days, Nasdaq volume can spike 2–3x normal and intraday volatility is elevated. For Indian traders holding Nifty positions overnight through a US triple witching Friday, expect that GIFT Nifty may gap significantly based on US closing moves.
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