Tech stocks rebounded from their worst open in months on Tuesday, after prepared testimony from Federal Reserve Chairman Jerome Powell cooled rate fears that fueled a late February rout.
Many important stocks fell, but modestly. Tesla Inc. had fallen 2% after falling as low as 12% early in the session, while the Nasdaq Composite Index was down 1% after an early 4% drop that put it on track for its worst day since September. The index is down 6% from its February 12 high, as rising U.S. interest rates prompt a broad reassessment of investor growth expectations and on track for sixth straight cut – its longest decline in a year.
Tesla, whose 743% rise last year underlined the tech-driven market rebound following the sale of coronaviruses, is now down for 2021 and has lost a quarter of its value since the electric car maker said on Feb. 8 it had spent $ 1.5 billion. on Bitcoin with the aim of increasing cash returns.
Other investor favorites also recovered after being hit hard early in the session. Moderna Inc., the maker of a major Covid-19 vaccine, fell 7% after falling 13%. Apple Inc. fell 2% and Amazon.com Inc. fell 1%.
Tech companies have become favorites among small investors who have piled up in stock and options trading over the past year, with the Nasdaq rising 44% in 2020. But the scale of the rally sparked concerns that many stocks are overvalued, leaving them vulnerable to sudden meltdowns.