Coinspeaker
Nasdaq Composite Soars Over 1% as Tech Stocks Rebound
In a remarkable turnaround, the Nasdaq Composite (INDEXNASDAQ: .IXIC) gained more than 1% on Tuesday. Amidst global concerns about inflation, rising interest rates, and supply chain disruptions, the index managed to reclaim lost ground, providing a glimmer of hope to investors who had witnessed a series of fluctuations throughout August.
The tech-heavy index exhibited remarkable resilience by gaining 1.74%, closing at an impressive 13,943.76 points. This climb served as a reminder of the Nasdaq’s historical resilience in the face of adversity, drawing parallels to its ability to bounce back from previous downturns.
The Nasdaq’s strong performance triggered a favorable domino effect across other key indices. The S&P 500 Index (INDEXSP: .INX) marked its best performance since early June by climbing 1.45% to conclude at 4,497.63. Similarly, the Dow Jones Industrial Average (INDEXDJX: .DJI), composed of blue-chip companies from diverse industries, increased by 292.69 points or 0.85%.
Meanwhile, Nvidia Corp (NASDAQ: NVDA), a well-known chipmaker, took the lead among stocks with a rise of more than 4%. This gain set the tone for other technology stocks to rise, indicating renewed investor interest in the industry. The success of Nvidia reverberated through the market, propelling shares of major tech players like Meta Platforms Inc (NASDAQ: META), Tesla Inc (NASDAQ: TSLA), Apple Inc (NASDAQ: AAPL), and Microsoft Corp (NASDAQ: MSFT) to finish the day on an upbeat note.
While the spotlight shone brightly on the tech sector, other notable movements also captured market participants’ attention. Telecommunications giant AT&T Inc (NYSE: T) saw a rise of 3.9% after receiving an upgrade from Citi. Similarly, Best Buy, a prominent retailer, witnessed a 3.8% increase in its shares following a reported earnings beat.
The Driving Force Behind the Tech Rebound
At the core of the Nasdaq Composite’s resurgence was the undeniable role of bonds and economic data. Falling bond yields, a consequence of the release of new US economic data, played a pivotal role in reinvigorating investor interest in the tech sector.
The 2-year Treasury yield, a key benchmark, witnessed a substantial decline of up to 16 basis points. This downward movement was triggered by softer-than-expected consumer sentiment data, which registered a reading of 106.1, notably lower than the forecasted 116 reading by economists polled by Dow Jones.
Another key influence was a favorable court decision for Grayscale Investments against the US Securities and Exchange Commission (SEC) in its Bitcoin Exchange Traded Fund (ETF) case.
This news rippled through the market, elevating the value of crypto exchange Coinbase Global Inc (NASDAQ: COIN) by nearly 15%. The possibility of a Bitcoin ETF has long been a topic of interest among investors, as it could provide a more accessible and regulated way for traditional investors to participate in the crypto market.
