Nasdaq records two straight highs as analysts weigh buying after the rally
The Nasdaq rose 2.3% to a record Monday and added 0.5% Tuesday, but historical gains and AI optimism come with breadth and rate concerns.
By Frankie Delgado · News Reporter
3 min read
The Nasdaq record high pullback debate is back after the tech-heavy index surged 2.3% to a record close on Monday, then gained another 0.5% to a fresh closing high on Tuesday, MarketWatch reported.
Monday’s move was the Nasdaq Composite’s largest one-day rise in seven weeks. It was also the index’s 21st record close of 2026 and its first since early June, according to Dow Jones Market Data as cited by MarketWatch.
The rapid climb can make investors wary of buying after prices have already run up. But Bespoke Investment Group data cited by MarketWatch found that, historically, Nasdaq advances of more than 2% that finish at a new peak have been followed by stronger-than-average returns over the next one, three, six and 12 months.
One month after those past signals, the Nasdaq gained 3.7% on average, according to the data. The reporting did not provide the number of cases studied, the dates covered or the study’s full methodology, so the pattern is not a forecast of what will happen next.
Should investors wait for a Nasdaq pullback?
The historical result is one argument against treating a record high as an automatic reason to sit out. It is not a universal instruction to buy, or a substitute for an investor’s own goals, time horizon and tolerance for losses.
Supporters of the upbeat case also pointed to the artificial-intelligence trade and corporate profits. Mona Mahajan, head of investment strategy at Edward Jones, told MarketWatch that heavy spending on AI infrastructure could keep that trade going into next year. She also said productivity gains could widen the market’s AI-related strength.
Mahajan viewed the Federal Reserve’s latest rate increase as a mid-cycle policy adjustment rather than the start of an aggressive run of increases. That is her assessment, not an established market outcome.
She cited the Atlanta Fed GDPNow tracker’s estimate for annualized third-quarter real GDP growth of 5.1%, compared with reported 1.5% growth in the second quarter. Third-quarter earnings reports in the coming weeks could also test the optimistic profit outlook.
Yardeni Research said analysts had been lifting earnings expectations faster than stock prices had risen, which it said could lead investors to reconsider valuations for large technology and semiconductor companies.
What could challenge the bullish Nasdaq case?
MarketWatch also flagged concerns over limited participation in the latest rally and the drag higher interest rates can place on stocks. Separately, Nasdaq Dorsey Wright said 30% of NYSE-listed stocks were above their 50-day moving averages in the prior week, its lowest reading since April. That measure covers NYSE stocks, not specifically Nasdaq members.
Its Sept. 18 technical commentary also identified resistance for the Nasdaq Composite up to 27,000. The index’s record run has produced a bullish historical signal, but the available data and analyst views leave plenty for the market to prove.
This story draws on original reporting from MarketWatch.