Wall Street rallies on strength of tech stocks

The US markets are up after a day of steep decline.

 Wall Street sign
Source: Bloomberg

Wall Street rallied at the end of a trading day after a 500 point drop. The comeback in the US markets comes on the strength of tech stocks.

Wild day of trading

The trading day started with a downturn in stocks as investors worried about the US-China trade impasse. The recent arrest of Chinese tech company executive, Meng Wanzhou, for violating US sanctions has led to more tension between the two nations.

There was also the worry about Brexit and how the UK leaving the European Union would affect he European markets. Since UK Prime Minister, Theresa May, cancelled the Brexit vote, investors were panic selling. However, shares in technology companies rose, which erased the earlier losses of the trading day. Shares of Facebook and Google went up. Even Apple had an uptick after having sales of some its iPhones halted.

December is a volatile month for US markets

Despite the positive news, financial analysts warn that more unprecedented unpredictability in the markets is expected. Liz Ann Sonders, chief investment strategist at Charles Schwab, believes that there was no one set reason for the late-day rally of tech stocks helping he US markets avoid another day of steep losses.

‘Higher volatility and wider intraday and intraweek ranges are likely par for the course these days and momentum can shift without an easily-defined reason. A few key large cap tech stocks caught a bid today and that helped rally the Nasdaq off the day’s lows’, said Liz Ann Sonders, chief investment strategist, at Charles Schwab & Co.

The US markets will become more volatile as the US Federal Reserve will have its meeting later this month. Whether or not the Fed raises or stabilizes interest rates, US stocks could be going on another wild ride.

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