## U.S. Stock Market: The Foundation of Global Stock Indices

When discussing the global financial markets, the U.S. stock indices cannot be overlooked. With influence extending beyond borders, Wall Street has become the heart of the global economy, accounting for up to 75% of the world's market capitalization. Measures such as **Dow Jones**, **S&P 500**, **Nasdaq Composite**, and **Nasdaq 100** not only reflect the U.S. economic situation but also profoundly impact other global stock indices.

The U.S. stock market is managed by two giant exchanges: **New York Stock Exchange (NYSE)** and **Nasdaq**. As of September 2022, the total market value exceeded $46.5 trillion, with NYSE accounting for over $30.1 trillion. This figure demonstrates the undeniable strength of the two largest exchanges on the planet.

## 4 U.S. Stock Indices Holding Market Power

Among approximately 5,000 indices in the United States, these four lead in influence:

**Dow Jones (DJIA)** was established in 1896 by Charles Dow to measure the performance of 30 major companies. Today, it represents about 25% of the total U.S. stock market value. Dow Jones is not only affected by economic data but also highly sensitive to geopolitical events, from wars to pandemics.

**S&P 500** was founded in 1957 by the S&P Dow Jones Indices joint venture, including the 500 largest publicly listed companies. This index accounts for 70% of the U.S. stock market value and is considered the gold standard for large-cap stocks worldwide. However, 50% of the S&P 500's value is determined by its 45 largest constituent companies, which can cause index volatility concentrated in a specific group of companies.

**Nasdaq Composite** was established in 1971, comprising thousands of medium to small companies. Unlike Dow Jones or S&P 500, Nasdaq Composite contains many startups, thus reflecting the activity of the tech sector and the investment trends of high-risk traders more comprehensively.

**Nasdaq 100** is a subset of Nasdaq, including the 100 largest listed companies, focusing on Technology, Telecommunications, Biotechnology, Media, and Services sectors. This index is the best measure to track the trend of leading technology companies.

## Outstanding Performance of Indices Over the Past 5 Years

The U.S. stock market has recorded impressive growth:

- **S&P 500**: up 85.78%
- **Dow Jones**: up 54.13%
- **Nasdaq 100**: up 147.43%

At the stock level, tech giants have performed even more remarkably:

- **Microsoft (MSFT)**: up 256.33%
- **Apple (AAPL)**: up 261.33%
- **NVIDIA (NVDA)**: up 1908.58% (this reflects the AI boom)

## From Bottom to Recovery: The Journey of 2022-2024

**Dow Jones** experienced significant volatility, dropping from a peak of 36,799 in January 2022 to 28,690 in September 2022 (a decrease of 28.3%), due to economic recession, energy crisis, and Fed rate hike decisions. However, from October 2023 onwards, Dow Jones began to recover and increased by 5.59% in the first three months of 2024.

**S&P 500** also followed a similar pattern. The index rose nearly 10% in Q1 2024 after the Fed signaled a rate cut, marking an important policy shift in the U.S. monetary stance.

**Nasdaq Composite** and **Nasdaq 100** followed similar trajectories to the S&P 500. Notably, Nasdaq 100 broke the 18,000 mark in March 2024 and increased by 24.17% over 6 months (as of April 2024), reflecting the resurgence of the tech sector.

## Investment Opportunities from U.S. Stocks: CFD Contracts

For international investors, the most popular way to participate in the U.S. stock market is through **CFD (Contracts for Difference)** trading. Instead of owning actual stocks, investors profit from the price difference between buy and sell points. The main advantage is the ability to profit from both rising and falling markets, along with high flexibility and lower initial capital requirements compared to buying actual shares.

The most prominent stocks currently include: **Microsoft** (442.85 USD), **Apple** (247.39 USD), **Amazon** (224.78 USD), **Google** (186.33 USD), and **Tesla** (400.52 USD). These companies continue to be the most favored choices among global investors.

## U.S. Stock Market Trends 2024-2025

The future of the U.S. stock indices will depend on two main factors:

**Federal Reserve's monetary policy**: Forecasts suggest the Fed will cut rates 3 times in 2024 and 4 times in 2025, according to Goldman Sachs. This will bring interest rates to a stable level of 3.25-3.5%, creating favorable conditions for stock market growth.

**Geopolitical factors**: Current conflicts such as the Russia-Ukraine war and Middle East tensions continue to exert pressure on the markets. According to David Bahnsen (Bahnsen Group), if Middle East conflicts escalate, stock markets could decline by 7-10%. During uncertain periods, investors often shift to safe-haven assets like gold and Bitcoin.

## Conclusion

The U.S. stock market remains a bright spot amid the global economy. With a strong recovery since October 2023, investment opportunities are increasingly abundant. Although uncertainties remain ahead, the long-term trend of U.S. stock indices continues upward, especially with the Fed's potential rate cuts. Investors who grasp these movements will have an advantage in 2024 and the coming years.