Tech-heavy Nasdaq Climbs 3% On Bargain Hunting, Easing Oil Prices

The tech-heavy Nasdaq surged 3% on Wednesday, leading a rally on Wall Street as sharp losses this week from worries over the fallout of the Ukraine crisis saw investors scoop up beaten-down stocks, with sentiment lifted by a pullback in oil prices.

Reflective of the broad-based advance, nine of the 11 major S&P sectors rose. Financials climbed 4% - tracking its best day since January 2021 - after declining 6.3% in the past four sessions on concerns over the impact of Western sanctions on Russian banks, assets and individuals over its invasion of Ukraine.

The S&P 500 banks index added 4.9%, powered by a 6.6% rise in Bank of America.

Providing the biggest boost to the S&P 500 and the Nasdaq indexes were the megacap growth stocks. Amazon.com Inc, Apple Inc, Microsoft Corp, Alphabet Inc Tesla Inc and Meta Platforms gained between 1.7% and 4.1%.

The energy sector was the biggest decliner, down 1.6%, as oil slipped below $125 following a sharp rally this week that helped it breach $130 a barrel. [O/R]

"The pullback in oil and commodity stocks have induced this rally. It's just profit-taking in terms of oil, gold and the agricultural products and some bargain hunting in equities," said Peter Cardillo, chief market economist at Spartan Capital Securities in New York.

"Nothing has changed. We could still have one more trip downwards, test the lows that we saw yesterday or trade around that before we can say that the market has bottomed out."

Travel and leisure stocks also soared. Carnival Corp and United Airlines Holdings climbed 9.0% and 8.4% respectively, after plummeting this week as soaring oil prices threatened a nascent recovery.

Surging crude prices have rattled global markets, with investors worrying it could lead to higher inflation and slow economic growth when global central banks are looking to tighten monetary policies.

The U.S. Federal Reserve is widely expected to raise interest rates at its March 15-16 meeting.

Meanwhile, market participants also cited a report that Ukraine was open to Russia's neutrality demand, helping lift the mood.

"The markets crave peace, they don't like unrest. It looks like rumor at the moment but any potential for peace negotiations would be great for the markets," said George Young, portfolio manager at Villere & Co.

Ukraine accused Russia of bombing a children's hospital in the besieged port of Mariupol during a supposed ceasefire to enable some of the hundreds of thousands of civilians trapped in the city to escape.

At 12:07 p.m. ET, the Dow Jones Industrial Average was up 710.93 points, or 2.18%, at 33,343.57, the S&P 500 was up 108.39 points, or 2.60%, at 4,279.09, and the Nasdaq Composite was up 412.57 points, or 3.22%, at 13,208.12.

General Electric rose 4.1% as the company authorized a $3 billion share buyback program.

The CBOE volatility index, also known as Wall Street's fear gauge, fell to its lowest level since March 4.

Advancing issues outnumbered decliners by a 3.27-to-1 ratio on the NYSE and by a 4.47-to-1 ratio on the Nasdaq.

The S&P index recorded two new 52-week highs and a similar new lows, while the Nasdaq recorded 25 new highs and 37 new lows.