Despite facing inflationary pressures and the impact of oil prices, the Nasdaq Composite Index has exhibited a strong performance in 2023, with a year-to-date growth of 26.1%. This growth has been recorded despite a 5.9% dip in September. Meanwhile, the technology sector is demonstrating resilience in the face of rising interest rates.
Tech giants such as Meta (NASDAQ:META), Microsoft (NASDAQ:MSFT), and Alphabet (NASDAQ:GOOGL) stand to benefit from a predicted AI boom. The anticipated surge in AI is expected to significantly impact High-Dividend ETFs, particularly in the second half of the 2024 fiscal year. This comes as the 10-year Treasury yield reaches a 15-year high, reflecting an environment of increasing interest rates.
The Federal Reserve's strategy based on the Fed's dot plot projections includes further hikes, marking the twelfth hike since March 2022. Additionally, there are potential plans for two rate cuts expected in 2024. This is part of an ongoing effort by the Federal Reserve to manage inflation and stabilize the economy.
These economic factors have set the stage for a dynamic market environment in which tech companies are poised to thrive amidst increased interest rates. The robust growth of the Nasdaq Composite Index this year and the resilience of tech giants like Meta, Microsoft, and Alphabet underscore the strength of this sector even in challenging economic conditions.
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