Stocks rally as economic weakness shows signs of bottoming, driven by renewed institutional risk appetite.

Stocks, led by the S&P 500 and Nasdaq 100, have surged recently due to renewed institutional risk appetite, with high-beta stocks outperforming. Economic indicators like durable goods orders and capital expenditures suggest that economic weakness may be bottoming out. However, equity valuations, especially for high-beta stocks, seem to have already priced in much of the expected economic recovery. The current market rally is broad-based and driven more by increased risk appetite than by strength in specific sectors like technology or cyclicals.