Wall Street's main indexes rallied strongly on Tuesday, with the Nasdaq surging 3% as investors piled onto beaten-down quality technology stocks, while Intel jumped after plans to take its self-driving car unit public.
The Nasdaq has climbed nearly 4% so far this week, more than recovering all its losses suffered last week when the Federal Reserve's hawkish comments about speedier taper spurred bets about an early interest rate hike next year to curb surging inflation.
"The markets understand that a zero interest rate environment is not going to last forever, that the Fed is going to use a measured approach to raising rates and not just some dramatic balance upwards," said Kim Forrest, chief investment officer at Bokeh Capital Partners in Pittsburgh. "This is a reflection of what is driving the market. Things that were on sale are being bought, especially those higher multiple stocks."
Optimistic comments from a top U.S. official about the nature of the Omicron variant and positive data on a COVID-19 drug's efficacy against the latest variant also boosted investors' sentiment.
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