Wall Street Daily (April 9): US stocks rebounded strongly on Wednesday, 'pressure eased but not completely lifted'; the market entered a typical phase of risk repricing, with technology stocks, small caps, and Chinese stocks surging simultaneously

Summary: US stocks surged strongly on Wednesday driven by the ceasefire news, with the S&P 500 up 2.51%, Nasdaq up 2.80%, Dow Jones up 2.85%, and Russell 2000 up 2.97%; VIX dropped to 21.04, plunging 18.39% in a single day, showing clear signs of 'easing pressure but not fully relaxed.' The core catalyst for the session was the two-week ceasefire arrangement, which rapidly weakened the 'war premium' that had dominated the market over the past few weeks. Crude oil plummeted 13.63% in a single day, while technology, industrials, financials, and consumer discretionary sectors broadly recovered. In major asset classes, the US dollar index fell 0.55%, gold rose 1.70%, crude oil dropped to near $98, and Bitcoin fell 1.57%—the sharp drop in oil prices alongside rising gold prices reminded the market that while risk recovery was strong, it was far from being 'worry-free.'

I. Major Events

1. Ceasefire eliminates war premium; the market enters a typical phase of risk repricing

The most important theme on Wednesday was that the ceasefire news quickly weakened the 'war premium' that had dominated the market over the past few weeks. The market's biggest concern before this was the energy shock caused by the blockage of the Strait of Hormuz and the potential resulting resurgence of inflation. As the two-week ceasefire arrangement came into effect, capital began to adjust this narrative. The final result was: a sharp drop in oil prices, lower yields, and a broad rally in global stock markets, shifting trading focus from 'energy shortages and inflation pressures' to systemic 'risk repricing.' Against this backdrop, all four indices surged together, with small caps and Nasdaq showing nearly 3% elasticity, indicating that funds were not only covering defensive positions but also increasing overall risk exposure.

2. Iran closes the strait again, market retains some safe-haven positions

However, this round of risk repricing was not without reservation. Iran subsequently closed the Strait of Hormuz again, and other fronts in the Middle East did not cool down simultaneously, suggesting that the ceasefire was more of a phased arrangement rather than the complete end of the conflict. Due to lingering uncertainty, the market did not fully unwind safe-haven positions at once. Gold continued to rise by 1.70% on the day, and afternoon trading did not further expand into a 'one-sided rally,' maintaining an overall balance between optimism and caution.

3. Tech stocks/Chinese concept stocks surged, with risk appetite spreading from indices to high-beta assets.

The more noteworthy aspect of the day was not just the rebound magnitude at the index level, but the broader synchronized recovery across high-beta assets. Meta rose 6.50%, Google increased by 3.56%, while NVIDIA and Apple both gained over 2%. Among Chinese concept stocks, high-elasticity names like Futu, Bilibili, and Alibaba led the rally. This structure indicates that Wednesday's rise wasn't merely a mechanical 'bounce after a big fall,' but rather, after systemic risks declined, capital began actively pursuing high-elasticity assets. Market risk appetite also spread from the index level toward higher volatility directions.

II. Major Trends

More importantly on Wednesday, it wasn’t just about the major index gains but the clear acceleration in short-term recovery. Over a two-week period, SPY rose 2.92%, and QQQ climbed 3.11%, significantly faster than the previous day, suggesting that the ceasefire and oil price crash pushed short-term risk recovery to a new level. However, when viewed over three months, SPY is still down 1.96%, and QQQ remains 2.32% lower, indicating the market has only moved from deep pressure to weak recovery and isn't fully back to favorable conditions yet. Meanwhile, IWM, RSP, and SPYV continued to outperform SPY and SPYG, showing that breadth, small caps, and value advantages haven’t been replaced by the tech rebound. In other words, Wednesday’s strong rebound was more about overall market risk recovery rather than reverting to the old pattern of a few giants lifting the index alone.

III. Market Sentiment

The keyword for market sentiment is 'sudden pressure drop, but not completely relaxed.' The VIX plummeted 18.39% in a single day, returning to around 21, indicating that the tightest tail-risk pricing was quickly removed. However, the level of 21 itself is still not low, meaning the market has only shifted from high-pressure to cautiously optimistic. The latest available value of CNN's Fear & Greed Index remains at 23, staying in the fear zone. The Put/Call ratio is still near the high of 0.9465, suggesting protective hedging hasn't entirely exited. Taken together, Wednesday's optimism was more event-driven risk recovery rather than sentiment returning to a worry-free state.

IV. Market Scan

1. Index ETFs

Index ETFs rose across the board, with elasticity evenly distributed. IWM gained 2.99%, making it the strongest among major index ETFs; QQQ rose 2.97%, closely following; DIA increased by 2.85%, and SPY climbed 2.55%. This shows that Wednesday's rally wasn't limited to tech or blue-chips but included small caps, growth, and traditional heavyweights, reflecting a typical systemic risk recovery.

2. Sector Performance

The industry-level contrast was even more pronounced. The industrial sector rose 3.75%, becoming the strongest performer, materials gained 3.33%, technology rose 3.10%, discretionary consumption increased by 2.83%, and financials climbed 2.65%. This indicates that after oil prices retreated and interest rate expectations eased, capital concentrated more on cyclical and growth recovery. The only significant underperformer was the energy sector, which fell 3.51%, directly mirroring the crude oil crash. Overall, Wednesday’s industry trend was clear: after oil prices dropped, capital flowed out of energy and into sectors benefiting more from cost declines and improved risk appetite.

3. Seven tech giants

Although the seven major tech stocks strengthened overall, their performance varied. Meta led with a 6.50% increase, Google rose 3.56%, NVIDIA gained 2.23%, and Apple climbed 2.13%, as platform and AI-related chains regained capital favor. Tesla, however, fell 0.98%, becoming the only large tech stock to decline noticeably. This means that while the tech sector did re-emerge as an important driver on Wednesday, it wasn’t an indiscriminate broad-based rally—capital still prioritized more certain elastic and prosperous directions.

4. Chinese Equities

The Chinese concept stocks direction saw nearly universal strength, marking one of the most recognizable high-beta recoveries in Wednesday's trading. Futu surged 11.47%, Bilibili rose 5.70%, Alibaba gained 4.68%, Tencent Music climbed 4.45%, PDD Holdings increased by 4.23%, and even the relatively weaker NetEase rose 1.37%. This indicates that the risk recovery brought by the ceasefire didn’t stop at the main US indices but quickly spread to overseas high-elasticity assets, with capital once again willing to embrace higher-volatility directions.

5. Cryptocurrencies

Bitcoin fell 1.57%, with the cryptocurrency price failing to keep pace with the equity market's risk recovery rhythm. However, among related stocks, RIOT surged 13.53%, showing that high-elasticity names in the crypto chain still attract short-term capital after risk events ease. Overall, Wednesday’s crypto sector seemed more like 'concept stocks releasing elasticity' rather than the cryptocurrency price initiating a new upward trend.

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