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Risk Appetites Revitalized in Supercharged U.S. Equities Rebound

  • Speculative stocks soar amid improving news on virus, China
  • Short covering, options dealers said to amplify market bounce

Risk-taking traders roared back to life Tuesday, abetted by speculators who had loaded up on too much protection against further losses.

Rallies in the most speculative corners of the market led U.S. stocks to the biggest surge since March, with all major averages climbing at least 2%. That was enough for the S&P 500 to wipe out all of the drop suffered after Federal Reserve Chair Jerome Powell’s hawkish tilt a week ago.