After sliding into correction territory, shares of technology companies rallied on Thursday, marking the biggest single day gain of the year.
In particular, electric vehicle stocks including Tesla (TSLA) and Nio Inc (NIO) have experienced sizable gains of over 15% each after being amongst the most beaten down names in the market. The likes of Square (SQ), Roku (ROKU), and DocuSign (DOCU) were also up by double digit percentages.
The recent market rebound can be attributed to a halt in rising treasury yields, but also the prospects of a new stimulus check and a “buy-the-dip” mentality, as the previously “expensive” tech shares now trade at more attractive multiples.
A general trend rotation toward cyclical stocks, however, is expected to continue. Courtney Dominguez, senior wealth advisor at Payne Capital Management noted that “this is a trend that tends to happen out of a recession.”