Walmart Soars 3.5% on AI Breakthrough and Nasdaq Inclusion—What’s Next?

Summary
• Walmart (WMT) surges 3.5% to a 52-week high of $118.84 amid a historic partnership with Google’s Gemini and Nasdaq-100 inclusion.
• The stock trades above its 200-day moving average (empty) and breaks through Bollinger Bands’ upper band at $117.21.
• Options volume spikes, with 17,708 contracts traded for the $118 call expiring Jan. 16, signaling bullish conviction.

Walmart’s stock is trading at record highs, driven by a strategic AI collaboration with Google and its pending inclusion in the Nasdaq-100. The rally reflects investor enthusiasm for the retailer’s tech-driven transformation, with options activity and technical indicators suggesting momentum is intact.

AI-Driven Commerce and Nasdaq Inclusion Fuel Walmart’s Record Rally
Walmart’s 3.5% surge is fueled by two catalysts: a partnership with Google to integrate Gemini AI into its shopping ecosystem and its upcoming Nasdaq-100 inclusion. The collaboration enables AI-powered product discovery via Gemini, positioning Walmart as a leader in agent-led commerce. Meanwhile, joining the Nasdaq-100—a tech-heavy index—validates its tech-centric strategy, attracting index-tracking ETFs and institutional flows. These moves align with Walmart’s shift from traditional retail to a digital-first model, highlighted by CEO John Furner’s emphasis on AI-driven transformation.

Internet Retail Sector Gains Momentum as Walmart Challenges Amazon’s Dominance
The Internet Retail sector is seeing renewed vigor as Walmart’s AI initiatives and Nasdaq-100 inclusion position it as a tech-adjacent disruptor. While Amazon (AMZN) remains the sector leader, its intraday price fell 0.097% as investors rotate into Walmart’s growth narrative. Walmart’s focus on AI-driven commerce and drone delivery contrasts with Amazon’s recent struggles in physical retail, suggesting a sector-wide shift toward tech-integrated retail models.

Options and ETFs to Capitalize on Walmart’s AI-Driven Bull Run
• MACD: -0.389 (Signal Line: -0.577, Histogram: +0.188) indicates bullish momentum.
• RSI: 48.86 (neutral) suggests no overbought/oversold extremes.
• Bollinger Bands: Price at $118.56 (Upper: $117.21, Middle: $113.61, Lower: $110.01) shows strong breakout.

Top Options Picks:
• WMT20260116C119 (Call, $119 strike, Jan. 16 expiry):
- IV: 26.97% (moderate)
- Leverage Ratio: 102.77% (high)
- Delta: 0.427 (moderate sensitivity)
- Theta: -0.538 (high time decay)
- Gamma: 0.105 (high sensitivity to price changes)
- Turnover: 1,086,300 (liquid)
- Payoff at 5% Upside: $118.56 → $124.49 → max(0, $124.49 - $119) = $5.49/share. This call offers high leverage and liquidity, ideal for capitalizing on a continuation of the AI-driven rally.
• WMT20260116C120 (Call, $120 strike, Jan. 16 expiry):
- IV: 26.66% (moderate)
- Leverage Ratio: 153.49% (very high)
- Delta: 0.325 (moderate sensitivity)
- Theta: -0.432 (high time decay)
- Gamma: 0.098 (high sensitivity to price changes)
- Turnover: 1,147,142 (liquid)
- Payoff at 5% Upside: $118.56 → $124.49 → max(0, $124.49 - $120) = $4.49/share. This contract balances high leverage with moderate delta, offering aggressive exposure if the AI narrative gains traction.

Action Plan: Aggressive bulls should target WMT20260116C120 into a break above $119.50, while conservative traders may use WMT20260116C119 for a safer play on the 52-week high breakout.

Backtest Walmart Stock Performance
The backtest of Walmart's (WMT) performance after an intraday surge of at least 4% from 2022 to the present shows no positive returns. The 3-Day, 10-Day, and 30-Day win rates are all 0%, indicating that the stock failed to generate any positive returns in the short term following the intraday surge. The maximum return during the backtest period was 0%, which occurred on the same day as the intraday surge, suggesting that the positive momentum did not persist.

Bullish Momentum Unlikely to Subside—Position for AI-Driven Growth
Walmart’s rally is underpinned by structural shifts in retail and AI adoption, with technical indicators and options activity confirming strong momentum. The stock’s 52-week high and Nasdaq-100 inclusion signal institutional validation, while the Google partnership opens new revenue streams. Investors should monitor the $118.84 52-week high and $116.41 intraday low for trend confirmation. Meanwhile, Amazon’s -0.097% dip highlights Walmart’s growing tech credibility. Position for a continuation of the AI-driven bull run by targeting the $120 strike calls or holding long-term ETFs as the sector evolves.