Regencell Bioscience, D-Wave, Akero lead U.S. gainers as market shrugs off rate jitters

Wall Street closed higher on May 20, 2025, with investors piling into high-beta tech, biotech, and AI-exposed names despite lingering inflationary concerns and hawkish commentary from Federal Reserve officials. The Nasdaq Composite led the rally with a 1.9% gain, while the S&P 500 rose 1.1%, and the Dow Jones Industrial Average added 0.6%, driven largely by a rebound in speculative names and renewed institutional interest in growth stocks.

Regencell Bioscience Holdings Limited, D-Wave Quantum Inc., and Akero Therapeutics, Inc. dominated the day’s top gainers list, with each posting gains north of 24%. The broader rally also reflected a sectoral rotation out of defensives and into high-growth equities as U.S. Treasury yields showed signs of stabilizing, and options volume hit multi-week highs.

Why Did Regencell Bioscience Surge Nearly 28%?

Regencell Bioscience Holdings Limited (NASDAQ: RGC) closed up a staggering 27.91% at $449.55, continuing a parabolic ascent that has now lifted the stock over 6,300% in the past 12 months. The Hong Kong-based bioscience firm, which focuses on neurodevelopmental disorder treatments, has emerged as a favourite among retail traders and select hedge funds following its strategic licensing updates and aggressive pipeline expansion. Despite a lack of recent press releases, speculative interest, short squeeze dynamics, and low float conditions contributed to the day’s price explosion.

Institutional flows remain mixed, with some fund managers cautioning against valuation risks while others cite the firm’s outsized optionality in an underpenetrated neurotherapy space.

D-Wave Quantum: AI and Quantum Computing Boom Continues

D-Wave Quantum Inc. (NYSE: QBTS) soared 25.93% to $16.56 on record volume of 303 million shares. The quantum computing firm, which has consistently drawn investor attention as a pure-play AI acceleration platform, benefited from a broader rebound in tech sentiment. Analysts indicated that recent customer wins and expanded commercial interest in D-Wave’s annealing-based solutions are reigniting hopes of an inflection point for quantum-as-a-service models.

Year-to-date, the stock is up nearly 960%, underscoring the speculative fervor surrounding small-cap AI and quantum names amid ongoing enterprise digitization trends.

Akero Therapeutics Rallies on NASH Hopes

Akero Therapeutics, Inc. (NASDAQ: AKRO) rallied 24.72% to $47.57, extending a strong rebound after recent updates on its Phase 3 program for efruxifermin, a treatment candidate for NASH (non-alcoholic steatohepatitis). While the biotech sector has struggled broadly under tightening financial conditions and funding constraints, Akero’s clinical momentum is drawing institutional inflows, particularly from healthcare-focused hedge funds.

Analyst sentiment has turned increasingly bullish, with multiple upgrades citing data robustness, market opportunity, and limited direct competition in the advanced-stage NASH pipeline.

Agilysys and Amer Sports Attract Growth-Oriented Bids

Hospitality software vendor Agilysys, Inc. (NASDAQ: AGYS) rose 22.10% to $101.37 as tech-sector buying momentum spread to overlooked enterprise software names. With a trailing P/E of 135, the stock remains richly valued, but bulls point to strong Q1 results and a sustained bookings uptick from the hotel sector’s digital transformation initiatives.

Amer Sports, Inc. (NYSE: AS), which recently re-entered public markets, added 19.05% to $37.37. The maker of Wilson and Arc’teryx is gaining traction with growth-oriented asset managers betting on premium consumer brand expansion in China and North America. Its market cap is now above $20 billion, with a steep valuation of 266x earnings—prompting warnings about overextension even as momentum remains strong.

Consumer and Lifestyle Stocks Bounce: Warby Parker, Peloton Join the Party

Warby Parker Inc. (NYSE: WRBY) jumped 15.63% to $20.34 on heavy volume, as investors rotated back into discretionary retail amid signs of improving foot traffic and e-commerce conversion rates. Peloton Interactive, Inc. (NASDAQ: PTON) added 6.84% to $6.72, extending its post-earnings recovery despite a turbulent restructuring phase. Bulls are optimistic about subscription growth and connected fitness hardware refreshes into H2.

Both names remain below pandemic-era highs but are increasingly being viewed as value rebound plays with asymmetric risk-reward, especially after aggressive cost cuts.

Gold and Vaccine Plays Lifted by Risk-on Flows

Sibanye Stillwater Limited (NYSE: SBSW) rose 14.46% to $5.54 amid modest strength in gold prices and bargain hunting in South African mining assets, while Moderna, Inc. (NASDAQ: MRNA) posted a 6.06% gain to $27.99 despite long-term weakness in vaccine-related revenues. The biotech giant remains a key barometer of post-pandemic biotech revaluation and speculative rotation within large-cap pharma.

AI and Automation Edge Up: Pony.ai, AeroVironment, Pegasystems

Autonomous driving firm Pony AI Inc. (NASDAQ: PONY) jumped 5.74% to $17.88 as investor focus returned to China-U.S. AV development competition. AeroVironment, Inc. (NASDAQ: AVAV) gained 5.07% on continued enthusiasm for military drone and AI-integration systems following increased defense funding signals in both the U.S. and NATO.

Pegasystems Inc. (NASDAQ: PEGA) added 4.93% to $103.29, benefiting from strong cloud software momentum and recent customer wins across financial services and healthcare sectors. Its 59% year-on-year gain is now drawing increased analyst scrutiny for potential valuation normalization.

Sentiment Analysis: Are Institutions Buying the Rally?

While the rally across speculative tech and biotech names suggests increased risk appetite, institutional activity remains bifurcated. Options volumes surged across RGC, QBTS, and AKRO, with hedge funds aggressively writing calls, while long-only asset managers showed more selective interest, particularly in names with strong pipeline visibility or revenue traction.

FII and DII activity on May 20 suggested net inflows into U.S.-listed ADRs and high-momentum Nasdaq stocks, but fund managers are still closely watching macro signals—especially inflation stickiness and Fed rate path projections.

Economic and Policy Backdrop: What’s Fueling the Rally?

The rally came despite elevated market anxiety over the Federal Reserve’s hawkish tone. Comments from FOMC members on May 19 indicated that rates could remain higher for longer if inflation does not decelerate sufficiently. However, softening used car prices and a cooler-than-expected Empire Manufacturing Index print briefly shifted market expectations toward a slightly more dovish 2025 rate trajectory.

Sector-specific tailwinds also played a role. In biotech, renewed focus on obesity, NASH, and cell therapy pipelines is driving a cautious recovery. In quantum and AI, increased enterprise adoption and federal grants continue to drive growth capital flows even amid broader market volatility.

Future Outlook: Are These Gains Sustainable?

Looking forward, traders remain divided on whether the surge in high-beta names represents the beginning of a durable rotation or merely a short-covering rally. Many of May 20’s top gainers are trading at valuations detached from near-term fundamentals, and earnings season volatility could resurface in June. Still, the rise in venture-funded and small-cap tech reflects returning speculative capital—a potentially bullish signal for risk assets.

Analysts caution that sustainability will depend on three key variables: Fed policy guidance in June, Q2 earnings surprise trends, and global macro stability, especially in China and Europe. As of now, momentum appears intact but fragile, especially in sectors highly correlated to bond yield movement and discretionary consumer sentiment.