History Says The Nasdaq-100 Could Be on the Cusp of a 6-Year Win Streak. Here’s 1

The Nasdaq-100 technology index is still recovering from a brutal 2022, when it plunged 33% into bear territory. But down years are quite rare: In the 37-year history of the index, it has delivered an annual loss only seven times.

Consecutive losing years are even less likely to occur. In fact, only the dot-com bust from 2000 to 2002 produced back-to-back annual drops in the Nasdaq-100.

True to history, the index has bounced back in 2023 with a powerful gain of 47% so far. But it gets better, because the data suggests once the Nasdaq-100 turns green, it tends to spark a roaring bull market.

There have been four bounce-back years for the Nasdaq-100 since 1986, and the index continued to rally for an average of 6.5 years on each occasion.

Fundamentals should push the Nasdaq-100 higher

Inflation hit a 40-year high in 2022, which prompted the U.S. Federal Reserve to hike interest rates at the fastest pace in its history. In the space of just 18 months, the federal funds rate soared from a historic low range of 0% to 0.25% all the way to the current range of 5.25% to 5.5%.

The move forced a change in investors’ appetite for risk. Fast-growing companies that thrived on low interest rates became less attractive, which sent their stock prices lower. Plus, investors could suddenly earn attractive returns on risk-free assets like deposits and U.S. government Treasury bonds. Again, that was bad news for stocks.

Data source: YCharts.

But the landscape has begun to shift yet again. Most experts believe the Fed has finished raising interest rates, and markets are pricing in five rate cuts in 2024. That could reignite spending among consumers and businesses alike, which would be great for corporate earnings, and fuel more upside in the stock market.

Below, I’m going to share one stock that could deliver substantial returns if that scenario plays out.

The beaten-down real estate sector presents an opportunity

The real estate sector has been crushed by the rapid rise in interest rates. The latest data on sales of existing homes points to the weakest housing market since 2010, with just 3.79 million homes expected to change hands this year.

Homeowners are reluctant to sell because when they purchase a new place, they will have to take on a mortgage with a much higher rate. Similarly, buyers are forced to bide their time because their borrowing capacity has been crimped by the higher rates.

However, those trends are set to reverse starting in 2024, and real estate technology company Redfin (RDFN -2.07%) could be one of the biggest winners. Its stock has already soared 68% in just the past month as a growing chorus of experts started calling for lower rates going into the new year.

The stock is still down 92% from its all-time high, and here’s why that’s a buying opportunity.

Redfin is building an impressive portfolio of real estate services

Real estate brokerages are Redfin’s bread and butter. The company employs 1,744 lead agents who serve 98% of the…