A market rally on Friday accentuated by rips higher in some battered and bruised technology stocks that faltered last year are making this year’s price action look a lot like 2021’s rally.
Beaten-down names including Tesla (TSLA), Carvana (CVNA), and Coinbase (COIN) were each up more than 10% on Friday.
Cathie Wood’s ARK Innovation (ARKK) ETF, a bellwether for high-flying tech, advanced 5.5%. ARKK has gained more than 25% this month alone, which Reuters notes puts the fund on pace for its best monthly gain on record.
A mini meme trade was also in the works on Friday.
Shares of BuzzFeed (BZFD) skyrocketed as much as 150% midday after an internal memo reveled the media giant was planning to lean heavily into AI to generate content. Shares closed up 85% on Friday.
That marks a big turnaround for the company, which has lost about three-fourths of its value since going public through a SPAC combination in late 2021.
Reddit-trader favorite GameStop (GME) rose 14% to cap a volatile session.
And Lucid Group (LCID), an electric vehicle manufacturer known for its mega SPAC merger in 2021, surged 43%.
Tesla, which wiped out 65% of its value in 2022 for its worst year on record, rallied 11% on Friday. For the year, Tesla is up 44%.
The stock’s rally this week also comes after Tesla’s quarterly results beat expectations, with the company telling investors it plans to begin production of its Cybertruck later this year.
“The recent rally in meme stocks and profitless tech stocks is a headfake and there is still plenty of excess capital in the system, even with all that the Federal Reserve has done over the past year,” David Trainer, CEO of investment research firm New Constructs, told Yahoo Finance on Friday.
Wall Street’s risk-on mood comes as investors speculate moderating economic data will prompt the Federal Reserve to end its rate hiking cycle sooner than expected. The U.S. central bank is expected to downshift its pace of interest rate hikes to 25 basis-points at its meeting next week.
Friday’s moves come in tandem with a broader push higher across the major stock averages that has all three indexes higher to start the year.
The tech-heavy Nasdaq Composite, which shed a third of its value in 2022, is leading the way with a 9% gain so far this year.