By Yasin Ebrahim
Investing.com – The Nasdaq jumped Tuesday, as higher-valued tech stocks rode the retreat in U.S. rates, with analysts suggesting the tech rally likely has more room to go.
The jumped 3.7%. The {169|Dow Jones Industrial Average}} rose 0.10%, or 30 points, though had hit a intraday record of 32,150.32, and the rose 1.36%,
Mega-cap tech stocks were back in favor following an 11% correction in three weeks as fell after the bond prices, which trade inversely to yields, hit oversold levels.
Apple (NASDAQ:), Microsoft (NASDAQ:), NASDAQ:), Alphabet (NASDAQ:), Facebook (NASDAQ:) and Amazon.com were sharply higher.
The upswing in tech stocks has sparked debate about whether the reprieve in growth stocks has staying power, or is merely a relief rally that will soon peter out. From a technical perspective, the rally in tech has more to go, according to Janney’s Technical Strategist and Associate Director of Research at Janney Montgomery Scott. “For now, the liquidity-fueled BTD [buy the dip] remains in place- and we would expect more follow-through on this tech rally over the short-run.”
Tesla (NASDAQ:), which was down about 40% since its recent selloff, was up more than 19%, riding fresh investor appetite for growth stocks and signs the electric vehicle maker is winning market share China.
“Early this morning the China Passenger Car Association (CPCA) released its February numbers which showed a snapback in demand for Tesla in this key region,” Wedbush said in a note. “For February, Tesla delivered 18.3k vehicles during the month which were up 18% from January and appear to be on a strong trajectory into March in our opinion,” it added.
Beyond tech, consumer discretionary stocks were sharply higher as investors bet on wave of consumer spending to come as U.S. households’ bank accounts will get another boost from the $1.9 trillion fiscal relief bill expected to signed into law before mid-March.
Cyclical stocks, which have assumed the leadership role in the broader market, gave up gains, with financials, industrials and energy trading lower.
Energy was the biggest decliner as oil prices continued to retreat following a 22% rally in February. Still, the pullback in oil prices is expected to be temporary on a snapback in fuel demand as the economy reopens.
In other news, the Reddit-focused stocks continued to rally, with GameStop Corp (NYSE:) up 27%, AMC Entertainment (NYSE:) up 13% and BlackBerry (NYSE:) up 7%
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