US Tech Stocks Rally Strongly After Three Days of Heavy Selling

The US tech stocks have bounced back strongly after a three-day sell-off, driven by a combination of factors including a sharp rebound in leading chip makers, stabilization of Bitcoin, and mass ‘buy-the-dip’ activity. The Nasdaq rose 2.18% to 23,031.21, while the Dow Jones gained 2.47% to 50,115.67, crossing the 50,000 mark for the first time. The S&P 500 also increased by 1.97% to 6,932.30.

The rally was led by chip makers such as Nvidia, which rose 7.8%, and Broadcom, which gained 7.1%. Other notable gainers included AMD, up 8%, and TSMC, which rose 4%. The stabilization of Bitcoin, which rebounded 12% to around $71,000, also contributed to the rally.

In addition to the rebound in chip makers and Bitcoin, the rally was also driven by positive corporate-spending signals from Amazon and Alphabet. Amazon announced a $200 billion capital-expenditure plan focused on AI, chips, robotics, and low-earth-orbit satellites, while Alphabet disclosed a similar multi-billion-dollar AI-investment push. These announcements helped restore confidence in the sector’s growth outlook.

The sentiment shift was also driven by cheaper valuations and lower volatility, with the VIX falling back below 20. This made risk-on traders re-enter the market, driving the rally in tech stocks.

Sources