Tech stocks have rallied following Tuesday's sell off

US stock markets rebounded on Wednesday as investor nerves cooled after billion-dollar short positions disclosed in leading AI companies sent tech stocks in a tailspin on Tuesday.

Star fund manager Michael Burry, of The Big Short fame, disclosed a $1.1bn (£843m) wager on Palantir and Nvidia shares falling on Tuesday, after drawing attention to similarities between the AI surge and dot com bubble in 2000.

That sent shares in Nvidia down 4 per cent to $201, wiping approximately $200bn from its market value, while Palantir shares fell 8 per cent.

But the following day, Wall Street has rallied in signs investors were buying the dip, with the tech-heavy Nasdaq rising 0.57 per cent in early trading to 23,480.62, while the S&P 500 increa

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