Indexes Research and Insights

Nasdaq Index Performance: January 2023

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Index Monthly Performance Report January 2023

The tech-heavy Nasdaq-100 (NDX) started the new year off strong despite the various economic and geopolitical headwinds it faces, gaining 10.6% in January. This rally marked the strongest January on record going back to 2001 and the best single-month return since July of last year. Overall, the indexes returned 8.7% on average, with 97 of the total 100 we track in this report finishing in positive territory, with an average return of 8.4% across all 100. The best-performing index over the last month was the Nasdaq Bitcoin Index (NQBTCS), up 40.1%. Outside of the crypto space, the top-performing index was the Nasdaq CTA Internet Index (QNET), which gained over 19%. On the flip side, the Dorsey Wright Healthcare Tech Leaders (DWHC) Index was the worst-performing index across all 100 we track in January, posting a loss of -1.0%.

Featured Indexes Performance

Within the Nasdaq Featured Index lineup, the Nasdaq Innovators Completion Cap Index (NCX) outperformed its peers with a gain of 13.9%. Even with a gain of 4.7%, the Nasdaq-100 Dorsey Wright Momentum Index (NDXDWA) was the worst-performing index for the month. On average, the Nasdaq Featured Indexes gained 10% in January.

Global Indexes Performance

All indexes in the Nasdaq Global lineup moved higher in January. The Nasdaq Developed Markets Index (NQDM) and the Nasdaq Emerging Markets Index (NQEM) finished up over 7%, while the Nasdaq Europe Index (NQEU) gained 8.6%. Within the United States, we saw significant strength from the Nasdaq US Small Cap Index (NQUSS), which finished up 11%, followed by the Nasdaq US Mid Cap Index (NQUSM), up 9.5%.

The OMX Stockholm 30 Index (OMXS30) led the way in terms of performance across the Nasdaq OMX Nordic Index suite with a return of 7.6%. The worst-performing within this group was the OMX Copenhagen 25 Index (OMXC25), with a loss of -0.1%.

Tech Suite Indexes Performance

Each Nasdaq Thematic/Tech Index finished in positive territory with an average gain of 11.1%. We saw considerable strength from the Nasdaq CTA Artificial Intelligence Index (NQINTEL) (+18.1%), the Nasdaq Clean Edge Green Energy Index (CELS) (+18.7%), and the Nasdaq CTA Internet Index (QNET) (+19.3%), all posting double-digit returns to kick off 2023. The weaker areas, relatively speaking, across this suite of indexes included the Nasdaq Biotechnology Index (NBI) (+3.5%), the ISE Clean Edge Global Wind Energy Index (GWE) (+3.3%), and the Nasdaq CTA Cybersecurity Index (NQCYBR) (+4.4%).

Dorsey Wright Indexes Performance

The suite of relative strength-driven Nasdaq Dorsey Wright Indexes mostly moved higher, except for Healthcare (DWHC) and Utilities (DWUT), two of the more defensive sectors in the suite, which lost -1.0% and -0.6%, respectively. The Dorsey Wright Basic Materials Leaders Index (DWBM) was the top-performing index, with a gain of 14.2%. Within the international space, the Dorsey Wright Developed Markets Index (DWADM)’s gain of 7.7% managed to outpace its emerging counterpart, the Dorsey Wright Emerging Markets Index (DWAEM), by just over 3%. The Dorsey Wright International Focus Five Index (DWANQIFF) gained 5.7%.

Dividend & Income Indexes Performance

January’s rally also took place across the Nasdaq Dividend and Income Indexes, each of which finished with a gain of at least 2%. The Nasdaq International Dividend Achievers (DAT) led the way with a gain of 8.2%, followed by the Nasdaq Technology Dividend Index (NQ96DIVUS), which finished up 8.1%. The relative laggard of the group in January was the Nasdaq US Broad Dividend Achievers Index (DAA) (+2.3%).

The six indexes within the Nasdaq Options Suite finished January in the black with an average gain of 6.3%. The CBOE Nasdaq-100 Half BuyWrite Index (BXNH) was the top performer of the group, with a return of 9.0%.

Green Economy Indexes Performance

Like the other areas we’ve covered, the Nasdaq Green Economy Indexes all finished up for January. The best-performing index was the Nasdaq OMX Solar Index (GRNSOLAR), with a gain of 10.5%. We also saw strength from the Nasdaq OMX Green Economy Index (QGREEN), which gained 9.3%. Wind (GRNWIND) managed to gain 2%, making it the group’s laggard despite a positive month.

Other Assets Indexes Performance

The Nasdaq BulletShares Index returns were somewhat muted in January. The outperformer was the BS High Yield Corporate Bond 2026 TR Index (BSJKQ), up 3%, followed by the BS High Yield Corporate Bond 2024 TR Index (BSJKO), up 2.4%. The average return across this suite of indexes was 1.1% in January.

Finally, all three of the Nasdaq Crypto Indexes rallied in January, with the Nasdaq Bitcoin Index (NQBTCS), Nasdaq Crypto Index (NCIS), and Nasdaq Ethereum Index (NQETHS) finishing up 40.1%, 38.2%, and 33.7%, respectively.

January Index Performance Summary

Investors welcomed January’s broad rally after wrapping up a tough 2022, although not much has changed between now and then. The possibility of a soft landing remains up in the air, all while geopolitical tensions remain present. The Fed continues to signal that it will be data-dependent and has acknowledged that we’ve started to see some disinflation. As a result, the Fed has continued to slow down the rate hikes from 75 bps, to 50 bps, to just 25 bps in February. Nevertheless, the Nasdaq-100 recorded its best January since 2001, giving investors some much-needed optimism as we move into February and further into 2023. On a rolling one-year, price return basis, the Nasdaq-100 is down 18.94% through 1/31/2023.

 

Nasdaq® is a registered trademark of Nasdaq, Inc. The information contained above is provided for informational and educational purposes only, and nothing contained herein should be construed as investment advice, either on behalf of a particular security or an overall investment strategy. Neither Nasdaq, Inc.  nor any of its affiliates makes any recommendation to buy or sell any security or any representation about the financial condition of any company. Statements regarding Nasdaq-listed companies or Nasdaq proprietary indexes are not guarantees of future performance. Actual results may differ materially from those expressed or implied. Past performance is not indicative of future results. Investors should undertake their own due diligence and carefully evaluate companies before investing. ADVICE FROM A SECURITIES PROFESSIONAL IS STRONGLY ADVISED.

© 2023. Nasdaq, Inc. All Rights Reserved.

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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