The Nasdaq 100 ETF (QQQ) is surging higher on Thursday following the release of June’s nonfarm payrolls report.
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During the month, nonfarm payroll jobs increased by 147,000, well above the expectation for 110,000 jobs and May’s upwardly revised figure of 144,000 jobs. In addition, the unemployment rate fell to 4.1% from 4.2%.
“You are not getting a July rate cut — that is now completely off the table,” said RSM chief economist Joe Brusuelas in an interview with Yahoo Finance following the release of the data. A stronger jobs market decreases the chances of a rate cut.
The Fed has a dual mandate to maximize employment and keep inflation around the 2% level. Interest rate cuts work to stimulate the economy by lowering the cost to borrow, which provides a growth booster to companies that support more hiring.
The chances of a July rate cut plummeted following the nonfarm payrolls data. The odds of rates remaining between 4.25% and 4.50% surged to 93.3% compared to 76.2% yesterday and 79.3% a week ago. The odds of a 25 bps reduction fell to 6.7% from 23.8% yesterday and 20.7% a week ago.
The Nasdaq 100 (NDX) is up by 1.10% at the time of writing.
Which Stocks are Moving the Nasdaq 100?
Let’s take a look at TipRanks’ Nasdaq 100 Heatmap, which illustrates the stocks that have contributed to the index’s price action.
Nvidia (NVDA) reached a new intraday record high of $160.98 on Thursday as the semiconductor leader approaches a $4 trillion market capitalization. Other chip stocks, like Broadcom (AVGO), Micron (MU), and Marvell (MRVL), are also well in the green.
Amazon (AMZN) is rising ahead of its Prime Day event from July 8 to 11. AMZN stock is up by about 9% during the past month.
Meanwhile, the technology index will soon have a new addition. Yesterday, Nasdaq announced that Datadog (DDOG) would replace Juniper Networks (JNPR) in the index, sending DDOG stock higher. Juniper is being replaced because Hewlett Packard Enterprise (HPE) acquired it on July 2.
QQQ Stock Moves Higher with the Nasdaq 100
The Nasdaq 100 ETF is an exchange-traded fund designed to track the movement of the Nasdaq 100. As such, QQQ is rising in correlation with the Nasdaq 100 today.
Wall Street has a “Moderate Buy” rating on QQQ stock. During the past three months, analysts have issued an average QQQ price target of $582.83 for the stocks within the index, implying upside of 4.64% from current prices. The 102 stocks in QQQ carry 88 buy ratings, 14 hold ratings, and zero sell ratings.