Why Quantum Computing Stock Skyrocketed 69.3% in June -- and What Comes Next?

Key Points

• Quantum Computing stock saw massive gains in June amid swelling excitement surrounding its technologies.

• Signs that the Federal Reserve was warming up to delivering an interest rate cut in July also helped power huge gains.

• Quantum Computing stock will likely be volatile in the near term, but long-term investors are probably still looking at a binary outcome.

• 10 stocks we like better than Quantum Computing ›

Quantum Computing (NASDAQ: QUBT) stock recorded another month of big gains in June's trading. The tech specialist's share price surged 69.3% in the month, according to data from S&P Global Market Intelligence. Over the same period, the S&P 500 (SNPINDEX: ^GSPC) bounded 5% higher, and the Nasdaq Composite (NASDAQINDEX: ^IXIC) rose 6.6%.

Excitement surrounding quantum-computing technologies continued to rise last month, and bullish indicators for the broader market helped power huge rallies for some players in the space. Quantum Computing stock is now up more than 180% over the last three months of trading.

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Quantum Computing stock soared amid a red-hot backdrop

A massive rally for quantum-computing stocks kicked off in May as investors bet that the technology could soon be reaching an inflection point, and the momentum continued in June. In an executive order issued on June 6, the Trump administration changed national cybersecurity guidelines and also highlighted the significant impact that quantum-computing technologies could have on the space. While the order discussed the risks to cryptography posed by advanced quantum computers, it also spotlighted the potentially revolutionary implications of the tech.

Optimism across the broader market also surged in June as comments from key Federal Reserve officials seemingly supported the idea that the central bank's Federal Open Market Committee (FOMC) could cut the benchmark interest rate at its July meeting. Lower interest rates typically create a more favorable backdrop for the market at large, and they're particularly beneficial for growth stock valuations. When it comes to extremely speculative, growth-dependent companies like Quantum Computing, the valuation impact of a lower interest rate environment is even more bullish.

What comes next for Quantum Computing?

As of this writing, Quantum Computing stock is roughly flat across July's trading. While investors are still seeing a significant chance for the Fed to serve up an interest rate cut this month, some new risk factors on the trade front have halted the recent surge in bullish momentum. The implementation of reciprocal tariffs on all countries except China has been pushed out to Aug. 1, but recent comments and moves from the Trump administration suggest that some countries could face tariffs that are significantly higher than previously anticipated.

Macroeconomic and geopolitical developments will likely continue to play large roles in Quantum Computing's short-term stock performance, and the company will likely see outsized valuation swings compared to the broader market in conjunction with developments on these fronts. On the other hand, investors are likely still looking at a binary outcome over the long term.

If Quantum Computing successfully advances and commercializes technologies that are at the forefront of its specialized category, the stock will likely deliver multibagger returns. But investors should move forward with the understanding that the stock will likely crater below current levels if the execution of the company's technology roadmap doesn't live up to expectations.

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Keith Noonan has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.