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Markets set to end March on higher note as bank fears wane

Yahoo Finance's Jared Blikre looks at headlines from March in the markets.

Video transcript

RACHELLE AKUFFO: All right, well, markets rising to the occasion as March draws to a close. But as the bulls come back, let's take a look at the big trends, gains, and key tickers this month. Joining us now, our very own Jared Blikre. Hey, Jared.

JARED BLIKRE: Hey, Rachelle. This year, 2023, has been the flip of last year. Tech stocks back in vogue, and let's explore why. First, the headline of the day or yesterday, the NASDAQ 100 back in a bull market. Now, this is a six-month chart. So what's happened here, you take this low from late last year, and you take this high that we had yesterday, that closing high. Guess what? That is 20%. It's only one definition of a bull market.

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And in fact, as you said, Rachelle, there have been other bull markets over the last couple of years. Now, here's another one that happened in the midst of that big decline. So in the middle of last year, we had a 20% rise from the low. But guess what? That low right here came down, took that low out from earlier, and we had a new bear market. Now we're back in a new bull. If it seems like a kind of flip flopping here, that's what happens with this tech-heavy index.

And in particular, the NASDAQ 100 is really geared and weighted heavily towards the mega caps. Here's the NASDAQ 100 versus the NASDAQ composite. Now, the 100 has 100 stocks, and the composite has about 3,000. The 100, which has a higher concentration of those mega caps, is up 18% this year versus about 14%, almost 15% for the NASDAQ composite. And this gets to the story of interest rates.

A lot of what we've seen this year-- and I get back to my original statement that this year is the flip, the reverse of what happened last year-- has to do with interest rates. And over the last three months or so, we've seen a big drop. And that's from the 10-year going from 4% all the way down below 3.4%. So we have a big range in here and a big drop, and that has kind of reinvigorated the tech trade.

But is it going to last? We'll probably need lower rates to continue going in this direction. And we also need a weaker dollar for stocks and overall, stocks overall, to continue their ascent. And that's what we're seeing today. Here, the DXY, the US Dollar Index, over three months threatening to go into territory that we haven't seen since February. And again, this is risk supportive.

So one more thing. Let me just get to some heatmaps and show you what's happened year to date. Here's the NASDAQ 100. I've been saying it's about the mega caps. Very apparent. Apple up 25%, Tesla up 60%, Nvida up almost 90%, and that is where we're seeing the strength here, Rachelle.

RACHELLE AKUFFO: Indeed. Thank you for that breakdown there, our very own Jared Blikre.