History Says The Nasdaq Will Soar 2 Artificial Intelligence Ai Msn

Bonisiwe Shabane

-Dec 2, 2025, 11:28 PM

history says the nasdaq will soar 2 artificial intelligence ai msn

Written by Will Ebiefung for The Motley Fool-> According to data from CNBC going back to 1980, the Nasdaq and other benchmark indexes have historically risen in the months following a presidential election. This trend has continued in 2024, with the tech-heavy index up by around 10% since Donald Trump's win on Nov. 5. A new administration can mean less political uncertainty, making many market participants more comfortable holding assets in general. There is no guarantee that the Nasdaq's momentum will continue in 2025.

But as Wall Street continues to pour money into AI tech, Advanced Micro Devices (NASDAQ: AMD) and Amazon (NASDAQ: AMZN) are two stocks could ride the wave into another year of stellar growth. Let's dig deeper. Where to invest $1,000 right now? Our analyst team just revealed what they believe are the 10 best stocks to buy right now. See the 10 stocks » With shares down 13% this year, AMD is a chipmaker that somehow missed out on much of the generative AI rally despite being a big player in the hardware side of the opportunity.

The chipmaker's diversified business model makes it a great alternative to Nvidia. And a reasonable valuation is icing on the cake for investors. The tech-heavy Nasdaq Composite index has clocked a healthy gain of close to 20% year to date as of this writing. Many companies in the tech sector are witnessing solid business growth thanks to the catalyst of the AI megatrend. The Nasdaq Composite index has registered a gain of about 20% in 2025 so far, and that's quite impressive considering that the index endured a difficult start to the year and pulled back substantially... There is a good chance that the Nasdaq will carry its momentum into 2026.

In an interview with CNBC, Ryan Detrick, chief market strategist of investment management firm Carson Group, pointed out that once bull markets hit three years, they tend to stretch to an average of eight... Where to invest $1,000 right now? Our analyst team just revealed what they believe are the 10 best stocks to buy right now. Continue » Last year was fantastic for the markets in general, but the index that really stood out was the Nasdaq. It climbed 28%, while the S&P 500 rose 23% and the Dow Jones Industrial Average increased 12%.

The Nasdaq, heavily weighted in technology companies, surged as investors piled into the industry's hottest new area: artificial intelligence (AI) stocks. Today's $200 billion AI market is forecast to top $1 trillion by the end of the decade, and investors have sought to get in early on this high-growth story. The technology has the potential to transform many industries, saving companies time and money, while boosting earnings as a result. And earnings growth often leads to positive stock performance. Where to invest $1,000 right now? Our analyst team just revealed what they believe are the 10 best stocks to buy right now.

See the 10 stocks » As 2025 gets started, it's logical to ask this question: After two years of gains, will the Nasdaq keep up the momentum this year? History says it will. If we look at the past periods of gains since 1990, in five out of six cases, the Nasdaq has climbed for three consecutive years or more. Of course, the market can surprise us and deviate from a trend, but in general, history has shown itself to be a solid guide. Now, let's look at my top AI stocks to buy before the Nasdaq takes off.

Daily stocks & crypto headlines, free to your inbox By continuing, I agree to the Market Data Terms of Service and Privacy Statement What a difference a year makes. After a 2022 when the U.S. suffered through decades-high inflation and the worst stock market performance since 2008, Wall Street staged a heady rebound last year. On the heels of its 35% decline in 2022, the Nasdaq Composite found its footing and gained 43% in 2023.

Students of economic history will know that the rally is likely to continue in 2024. Going back as far as 1972 -- the first full year that the tech-focused index existed -- in every year following a bear market rebound, the Nasdaq has returned 19%, on average. That pattern suggests that the current rally should still have legs. As in life, there are no guarantees in investing, but stock aficionados would do well to pay attention to the lessons of history. Furthermore, there's an argument that last year's rally was sparked by the recent advances in artificial intelligence (AI). It's still early days for generative AI, and companies are scrambling to determine how best to deploy these ground-breaking algorithms.

One thing's for sure: Two companies with long histories of integrating AI into their operations are well-situated to profit. Let's look at both. Amazon(NASDAQ: AMZN) is one of the most recognizable companies in the world, with business interests that stretch across a broad cross-section of both the consumer and commercial markets. A large contributor to Amazon's success has been the company's integration of AI into two business areas where it's the industry leader and a third where it's a major contender. The combination of its businesses in e-commerce, cloud computing, and digital advertising gives Amazon reach that's hard to rival. Amazon made a name for itself in digital retail, and it still dominates in that space.

While the numbers for 2023 are still being compiled, Amazon accounted for roughly 38% of all online sales in the U.S. in 2022, more than the next 14 competitors combined, according to data specialist Statista. Improving economic conditions will likely drive Amazon's business higher over the coming year. Technology stocks were in fine form on the stock market in 2024, with the tech-laden Nasdaq Composite (NASDAQINDEX: ^IXIC) index clocking impressive gains of 28.6% last year following an even stronger jump of 43%... Historical trends indicate that the Nasdaq Composite could be on track to deliver more gains in 2025. In any year where the Nasdaq managed a 30%-plus gain overall, it averaged a 19% jump in the year that followed.

Moreover, the Nasdaq averages a 17% return following a year in which it delivered returns of 20% or more. Of course, veteran investors are well aware that past returns cannot be taken as reliable indicators of future performance. However, the broader sentiment on Wall Street suggests that the stock market could head higher in 2025 on the back of continued investments in artificial intelligence (AI), a robust U.S. economy, and additional interest rate cuts by the Federal Reserve. © All rights reserved. Stock prices are provided by BSB-Software

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The Nasdaq Composite is up 30% over the last 12 months, kicking off a strong bull market. This market enthusiasm has significance for new investors, because the average duration of a bull market historically is 4.9 years, according to investment firm Stifel -- about three times longer than bear markets. Much of the growth in the Nasdaq Composite in this bull market is related to enthusiasm for all things connected to artificial intelligence (AI). The potential of this evolving technology has investors and market traders excited. Investors who focus on buying reasonably priced AI growth stocks now could have several years of handsome gains to look forward to. Here are two quality AI growth stocks to buy today.

Alphabet (NASDAQ: GOOG) (NASDAQ: GOOGL) is using AI technology it's developing to generate significant improvements across its business, including improving search results for users on multiple platforms it operates and boosting ad performance for... Alphabet began investing in generative AI technology in 2016, and its latest iteration is Gemini, a series of AI models it plans to use to lay the groundwork for the company's future. Gemini can generatively process and produce text, images, audio, and video based on user prompts, and the enthusiasm among users is already driving substantial growth for the company.

History Says The Nasdaq Will Soar 2 Artificial Intelligence Ai Msn

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