The much-awaited reconstitution of the Nasdaq 100 index has taken place, resulting in the addition of Bitcoin (CRYPTO: BTC) proxy MicroStrategy Inc. (NASDAQ:MSTR), Palantir Technologies Inc. (NASDAQ:PLTR), and Axon Enterprise Inc. (NASDAQ:AXON).
This change will take effect before the market opens on Dec. 23, 2024.
What Happened: Nasdaq announced on Saturday the results of its annual reconstitution of the Nasdaq-100 Index.
The Nasdaq-100 Index, a benchmark for non-financial companies on the Nasdaq, was launched in January 1985. It serves as a basis for financial products like options, futures, and funds.
The annual reconstitution aligns with the quadruple witch expiration Friday of the quarter, a strategic timing for the index.
As a result of this reconstitution, three companies will be removed from the index: Illumina, Inc. (NASDAQ:ILMN), Super Micro Computer, Inc. (NASDAQ:SMCI), and Moderna, Inc. (NASDAQ:MRNA).
The Nasdaq-100 Index is integral to the Invesco QQQ Trust (NASDAQ:QQQ), which seeks to mirror the index's performance. Options, futures, and structured products based on the Nasdaq-100 Index and the Invesco QQQ Trust are traded on various exchanges.
Why It Matters: The inclusion of MicroStrategy in the Nasdaq-100 could significantly boost its visibility and attract fresh inflows from major ETFs like QQQ.
Analysts at Bernstein have suggested that this move, combined with MicroStrategy's aggressive Bitcoin acquisition strategy, could lead to a 59% upside for the company, with a target price of $600.
Meanwhile, Palantir is positioned to become "the next Oracle" in 2025, according to Wedbush Securities' Dan Ives. The company's AI platform is seen as a transformative force in enterprise operations, with significant results already demonstrated through its Warp Speed manufacturing operating system.
This development could further enhance Palantir's standing in both government and commercial sectors, as highlighted in Ives' annual sector outlook.
On the other hand, Super Micro Computer finds itself removed from the index, despite benefiting from the surging demand for AI infrastructure. The company faced challenges due to a recent auditing scandal, which significantly impacted its market capitalization.
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Disclaimer: This content was partially produced with the help of AI tools and was reviewed and published by Benzinga editors.
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