Nasdaq faces more headwinds ahead

NASDAQ 100 tracks the performance of the top 100 non-financial companies in Nasdaq, and is commonly used to benchmark the performance of the overall technology sector as it accounts for more than 50 per cent of the index weighting.

Significant volatility can be seen since the start of 2022, with the US Federal Reserve's stance on interest rate hikes and actions that would be taken to cut down on the Fed's balance sheets. The current year-to-date performance of the Nasdaq 100 index is down 9.89 per cent as at Feb 10, 2022.

The 10-year Treasury yield breached the 2 per cent level on Feb 10, after the latest key inflation data showed strong inflationary price pressures. This further confirmed that the US Federal Reserve will be more aggressive in their interest rate hikes to rein in inflation.