For growth-oriented investors, the Nasdaq Composite (^IXIC 1.51%) has been the place to be for years now. After sharp gains throughout the 2010s and even in the early years of the COVID-19 pandemic, the Nasdaq suffered the most during the bear market in 2022. However, it's back with a vengeance so far in 2023, and it was up more than 1% by early Thursday afternoon, adding to its recent gains.
Among winning stocks in the Nasdaq, Nikola (NKLA 1.41%) and The Trade Desk (TTD 3.17%) stood out. Both are in very different phases of their business life cycles and face very different challenges, but both got a much-needed boost in their share prices on optimism that they can find more success.
Nikola deal inspires hope
Shares of Nikola soared 45% early afternoon on Thursday. The electric vehicle maker has investors excited about its latest initiative, even though some fear that it might come too late to make a big difference for shareholders.
Nikola announced Thursday morning that it had entered into a hydrogen supply agreement with hydrogen provider BayoTech. Under the terms of the deal, Nikola will obtain a reliable supply of hydrogen to help fuel the fleets of buyers of its zero-emission commercial fuel cell electric vehicles. Specifically, Nikola will acquire up to 10 of BayoTech's HyFill transport trailers to facilitate vehicle fueling, while BayoTech will purchase as many as 50 of Nikola's Class 8 hydrogen fuel cell electric vehicles to help pull its transport trailers to where they're needed. The first dozen of BayoTech's purchased Nikola trucks will get delivered sometime in 2023 or 2024, with the remainder coming over the next five years.
The news comes just after Nikola had released second-quarter production and delivery figures that also lifted shareholders' spirits. The company showed some signs that it will be able to ramp up its capacity over time and that demand could remain strong.
Even with the gain, Nikola stock remains far below its best levels of the past several years. It'll take a lot to restore the EV company's reputation, but deals like today's will be essential to show Nikola's viability as a business.
The Trade Desk will join the Nasdaq's big leagues
Shares of The Trade Desk climbed 5% Thursday afternoon. The programmatic advertising specialist's stock got a lift due to action from the overseers of a key benchmark of megacap stocks.
In an announcement late Wednesday, the Nasdaq said that it would add The Trade Desk to the list of stocks included in its Nasdaq-100 Index. The move was necessary because the overseers of the index expect to remove Activision Blizzard from the index as a result of its prospective pending acquisition by Microsoft. The Trade Desk stock will also get included in equal-weight versions of the index, as well as a similar index that excludes companies that are considered to be in the technology sector.
Index-related moves tend to have a bigger impact when a company gets added to the S&P 500 index. However, with so many investors following the Nasdaq closely now, The Trade Desk's inclusion in the Nasdaq-100 is a big deal and represents yet another milestone for the company.
If the economy keeps holding up well, then the advertising industry is likely to prosper. That has meant good times for The Trade Desk in the past, and it's likely that the ad company will be able to stay aligned with favorable trends and bend them to its own benefit.
