From NASDAQ:

2023 has been a big year for the U.S. stock market, driven by the AI boom, surge in “Magnificent Seven” stocks, cooling inflation, and the Fed’s optimistic conclusion of interest rate hikes. The Dow Jones Industrial Average reached a series of record highs while the S&P 500 is just 0.3% shy from the peak reached in January 2022. Both indices are set to conclude the year with impressive gains, with the Nasdaq Composite Index soaring 44%.

We have also seen an encouraging shift in the economy, signaled by Federal Reserve Chair Jerome Powell hinting at three rate cuts of 75 bps for the next year as inflation is easing and the economy is holding up better. Recent indicators suggest that economic activity has been expanding at a moderate pace, buoyed by robust consumer spending, strong job gains, and a low unemployment rate, along with improved corporate earnings.

The technology sector has been the most profitable, with a 54% increase, driven by the AI craze and surge in “Magnificent Seven” stocks. The construction sector gained more than 50%, driven by homebuilder stocks. Automotive sector has been boosted by the increased adoption of electric vehicles (EVs), and the retail space saw an impressive rally of more than 28%. The business services sector has risen 22.5% this year, with all industries performing remarkably well.

Notable stocks from the sectors include Nvidia, Dream Finders Homes, Blue Bird Corp., Carrols Restaurant Group, and Marathon Digital Holdings. These stocks have more than doubled this year, and have a Zacks Rank #1 (Strong Buy), #2 (Buy), or #3 (Hold). Notably, Dream Finders Homes surged 317% in 2023, Blue Bird soared 159%, and Carrols Restaurant surged 464%. Marathon Digital jumped an astonishing 688%. With the promising outlook for these companies, it is clear that these sectors have had a significant impact on the stock market.



Read more: 5 Top-Performing Stocks From the Best Sectors of 2023