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Nasdaq 100 futures gained 0.6% at 4:52 a.m. in New York, with Tesla (NASDAQ:TSLA) Inc. rising 1.8% and Apple Inc (NASDAQ:AAPL) climbing 1%. Microsoft Corp (NASDAQ:MSFT) and Meta Platforms Inc (NASDAQ:FB) were among other names moving higher.
The move extends Monday’s biggest rebound since March 23, 2020 when the Nasdaq wiped out a drop that reached 2.7% at its worst to finish higher by 0.1%. Optimism that a more hawkish Federal Reserve will seek to avoid hampering growth and signs that the omicron virus variant may be peaking is helping investor sentiment.
Last week, the Nasdaq endured a four-day skid that pushed it more than 8% below a November record.
“Markets are already pricing in a very aggressive hiking cycle from the Fed,” said Esty Dwek, chief investment officer at Flowbank SA. “Over the medium to long term, we still like tech stocks as inflation is probably peaking, earnings will remain strong and yields should remain somewhat contained.”
Four Fed Hikes May Be Just the Start as Traders Boost Rate Bets
Investors will be closely monitoring data due Wednesday on U.S. inflation, which is anticipated to have increased further in December, putting additional pressure on the central bank to tighten policy.
“Downside risks prevail in stock markets and growth stocks remain on the chopping block as they are the most sensitive to interest-rate changes,” Ipek Ozkardeskaya, senior analyst at Swissquote, said in written comments.
©2022 Bloomberg L.P.
