Some analysts say there's more to the upbeat outlook for the Nasdaq than just positive historical data, including a resurgent AI trade and rising corporate-profit expectations

The tech-heavy Nasdaq Composite Index is on track for a winning September.

The Nasdaq Composite Index's rapid rally to record highs may scare off some new investors who would prefer to wait for a pullback to start buying. But in fact, there's data to suggest it is better to jump right in.

On Monday, the Nasdaq COMP shot up 2.3% - its biggest one-day gain in seven weeks - to close at a record high. Based on data provided by Bespoke, stronger-than-average returns over multiple time periods tend to follow when the index jumps more than 2% to a new peak.

As highlighted in the chart below, the tech-friendly Nasdaq historically has climbed 3.7% one month following such a rally, with above-average gains also seen in the following three-month, six-month and one-year periods. To help prove the point, the Nasdaq rose 0.5% to another record close on Tuesday, while the S&P 500 index SPX lagged, with a fractional loss.

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The Nasdaq's record high reached on Monday was its 21st of 2026, but just the first since early June, according to Dow Jones Market Data. While there are concerns about the lack of participation in the market's latest rally, and about the negative effect of rising interest rates on stocks, there are some fundamental reasons that back up the upbeat outlook from Bespoke's data.

The artificial-intelligence trade, which has been behind the latest push higher in tech stocks, will probably continue to have "some legs through next year" on the back of tremendous spending on infrastructure for the buildout of AI, said Mona Mahajan, head of investment strategy at Edward Jones, in a phone interview on Tuesday. The stock market stands to benefit from a broadening of the AI trade on productivity gains, she said.

And in Mahajan's view, rather than be a negative for the market, the Federal Reserve's interest-rate hike this month was just part of some mid-cycle adjustments the Fed is making to its policy rate, rather than an aggressive series of hikes. And that might actually prove to be a positive for the market. She said stocks may keep on rising on the back of growth of corporate profits and economic expansion that the Atlanta Fed's GDPNow tracker currently estimates at an annualized 5.1% for third-quarter real gross domestic product, up from 1.5% growth in the second quarter.

Another potentially positive fundamental catalyst is when companies start reporting third-quarter earnings in the coming weeks.

"Investors have been watching analysts raising their earnings expectations faster than stock prices have been rising," potentially prompting investors to rethink valuations for some of the bigger technology names, and semiconductor stocks in particular, according to a note from Yardeni Research.

-Christine Idzelis