Nasdaq 100: Looking Past Volatility to Fundamental Strength

The Nasdaq 100 is experiencing a volatile correction in 2026, but according to Mark Marix of NASDAQ Index Insights, this isn't a sign of collapse—it's a predictable phase in a long-term bull market. Drawing parallels to the late 1990s tech boom, Marix argues that the current pullback mirrors historical patterns of volatility within sustained bull markets, with bear markets occurring every few years even amid strong fundamentals. Despite sharp declines in software stocks and AI-driven valuation compression, the Nasdaq 100 has held up due to diversification across semiconductors, consumer discretionary, healthcare, and even non-tech giants like Amazon, Walmart, and Tesla. Valuations have corrected by 20–25%, but earnings growth remains robust—15% YoY for 11 consecutive quarters—and forward PE ratios for mega-caps like Nvidia are still reasonable at around 20, far below late-90s bubble levels. The market’s fear is not about overvaluation in the index itself, but uncertainty around AI’s long-term impact. Marix predicts that as hyperscalers like Google, Meta, and Amazon demonstrate real ROI from massive CapEx, earnings momentum will surprise on the upside, especially given the current low valuations and strong demand for AI services. The narrowing volatility gap between the Nasdaq 100 and S&P 500 also signals that the Nasdaq 100 is increasingly viewed as a defensive haven during market stress.