With 2024 in the books, market participants now know that the tech-heavy Nasdaq Composite Index surged about 85% over the past two years.
A stellar two-year run, to be sure. And it’s one that could make some investors jittery about the specter of retrenchment. However, much of that concern is rooted in valuation and tariffs. Alone, valuation isn’t a reason to buy or sell a stock. And the extent to which, if any, President-elect Trump deploying trade tariffs remains to be seen.
In other words, there’s still a compelling case for mega-cap growth stocks entering 2025. That underscores potential benefits via ETFs like the Invesco QQQ Trust (QQQ ) and the Invesco NASDAQ 100 ETF (QQQM ). Those ETFs track the Nasdaq 100 Index (NDX). That index is the collection of the 100 largest nonfinancial services members of the Nasdaq Composite.
Familiar Faces Could Boost QQQ in 2025
QQQ and QQQM may deliver more upside in 2025. If so, many experts believe some of the ETFs’ most familiar holdings will again do the heavy lifting. That includes the Magnificent Seven cadre of Alphabet (GOOG), Amazon (AMZN), Apple (AAPL), Meta Platforms (META), Microsoft (MSFT), Nvidia (NVDA), and Tesla (TSLA).
Citing the catalysts of artificial intelligence (AI) and a more favorable regulatory regime under Trump, Wedbush analyst Dan Ives said in a recent report to clients that large- and mega-cap tech stocks can surge another 25% in 2025.
The analyst highlighted five members of the magnificent seven — Alphabet, Apple, Microsoft, Nvidia and Tesla — as possible drivers of that upside. That quintet combines for about 35% of the QQQ/QQQM portfolios.
“Ives added that there is still a ‘goldilocks’ economic set-up in the U. S.—referring to the ‘not too hot, not too cold’ dream scenario in which growth is strong, the unemployment rate is low, and inflation is running in line with the Federal Reserve’s 2% target,” reported George Glover for Barron’s.
Ives highlighted several other big tech stocks that could be names to watch in the new year. Those include Palantir Technologies (PLTR) and database engine developer MongoDB (MDB). They combine for nearly 1.20% of the QQQ/QQQM rosters.
Palantir is a new addition to the Invesco ETFs after being included in the Nasdaq 100 following that gauge’s annual rebalance in December. The stock was the best-performing member of the S&P 500 in 2024.
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