Analysts warn the recent rally may be short-lived as underlying concerns over AI valuations persist.
The Nasdaq Composite surged on Monday, leading major averages higher as technology stocks rebounded from last week’s selloff. The index climbed amid easing U.S.-Iran tensions and a broader market recovery, though analysts caution the AI-driven pullback could resume.
Last week’s decline erased over 5% from the Nasdaq, driven by profit-taking in high-flying AI-related stocks. Monday’s 1.5% gain partially reversed those losses, but trading volumes remained subdued, signaling cautious optimism.
Markets showed limited reaction to the rebound, with futures pointing to a muted open on Tuesday. Analysts noted that without a catalyst, the rally may lack sustainability.