D-Wave Quantum (QBTS 5.96%) stock recorded explosive gains over this week's trading. The company's share price surged 51.4% in a stretch that saw the S&P 500 rise 1.2% and the Nasdaq Composite rise 2.2%.
Like many other growth-dependent stocks, D-Wave Quantum got a big valuation boost this week thanks to the Federal Reserve cutting interest rates. D-Wave's share price also saw big gains as a result of some promising quantum computing news.
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D-Wave soars as Fed cuts rates
The Federal Reserve cut the benchmark U.S. interest rate by a quarter of a percentage point this week. While investors broadly expected the rate cut, Fed Chair Jerome Powell also indicated that investors would likely see two additional rate cuts this year. The move and commentary helped power big gains for speculative and highly growth-dependent stocks, and D-Wave benefited from the momentum.
Is the U.S. gearing up for a big quantum push?
Quantum computing stocks got a big boost following news that Rigetti Computing had signed a three-year, $5.8 million contract with the Air Force Research Lab (AFRL). While there was no direct news of D-Wave Quantum landing a contract with the AFRL or other government customers, investors saw the development as a broadly bullish indicator for stocks in the quantum space.
Following news of Rigetti's deal with the AFRL, Cyberscoop published a report stating that multiple sources had told them that the Trump administration was looking at potential executive orders and other measures to support the U.S.'s quantum computing industry. While quantum computing still seems in a relative state of infancy, government funding and support could play a significant role in pushing it forward, as the tech could potentially provide breakthroughs for artificial intelligence (AI) and cryptography-related applications.
