Bloomberg
Massive Nasdaq Rally Springs From Deepest Hole in Three Decades
(Bloomberg) — A day after the Nasdaq 100 fell more than 10% from a record into a technical correction, the tech-heavy benchmark made a resounding comeback.With roughly a quarter of the index’s members surging more than 5%, the Nasdaq 100 ended Tuesday up 4% for the best rally since November. ARK Innovation ETF, star manager Cathie Wood’s flagship fund that has suffered losses of at least 10% in each of the last two weeks, jumped the most on record, adding 10%. Shares of Tesla Inc., which had fallen more than 30% from January levels, soared 20%. Stay-at-home market darlings Peloton Interactive Inc. and DocuSign Inc. each rose more than 10%.Such is the aftermath of a technology selloff that, by one measure, reached the most oversold level in three decades. Data show droves of investors have been rushing to buy the recent dip, a strategy that — at least on Tuesday — was looking smart.“This whole idea of buying on the dip has been so ingrained in people’s psychology that you are going to see bounce backs after multi-day sell-offs,” said Marc Odo, client portfolio manager at Swan Global Investments. “That’s inevitable, unless there is some big event on the news where everything has changed.”In recent weeks, a rise in bond yields sparked a selloff in high growth stocks, with more than $1.5 trillion wiped off the Nasdaq 100 in less than a month. Expecting higher economic growth and…
