Stocks rallied on Wednesday (November 26), pushing the major stock averages to their fourth straight day of gains ahead of the Thanksgiving holiday.

The Dow Jones Industrial Average rose 388 points, or 0.8%. The S&P 500 gained 0.9%, while the Nasdaq Composite gained 1%.

The overall market rally was driven by artificial intelligence company Oracle, which surged more than 4% after Deutsche Bank reiterated its bullish stance on the company. Nvidia shares rose more than 1%, recovering from recent losses, while fellow "Magnificent Seven" member Microsoft traded more than 2% higher.

"This is just a recovery from the risk-off action we've had in the last week or two, which is completely normal," said Eric Diton, president and managing director at The Wealth Alliance. "Thanksgiving week is generally a strong week in the market. Everyone is feeling good."

The S&P 500 and Dow Jones are posting their best week since late June, with the broad-based index up more than 3% and the blue-chip Dow Jones up nearly 3% this week. The tech-dominated Nasdaq has gained more than 4% this week, posting its best week since mid-May.

"We're also about to enter the best period of the year for stocks – November through April," he continued. "It's hard not to remain optimistic here."

Stocks had a positive trading session on Tuesday despite volatile trading. The 30-stock Dow Jones recorded its third consecutive positive day, along with the S&P 500 and Nasdaq. Several technology stocks also gained, boosting the overall market. Alphabet hit a new record high after reports that Meta Platforms is considering using the Google parent company's TPU chips by 2027. However, chipmaker Nvidia fell more than 2.5%.

Investors continue to monitor catalysts that could influence the Federal Reserve's next interest rate move. Traders are pricing in a more than 80% chance of a quarter-percentage-point rate cut from the Fed in December, according to the CME FedWatch tool.

"If the Fed disappoints, you could see a sell-off," Diton told CNBC. "I don't think they'll do it."

Looking back, November has proven to be a difficult month for stocks. Although the three major indexes have pared monthly losses with gains this week, all are still posting losses as concerns about high valuations have dampened the momentum behind some rising tech stocks. The S&P 500 and Dow Jones are both slightly lower this month, while the Nasdaq is down about 2%.

The stock market will be closed on Thursday for Thanksgiving. Trading will resume with a shortened session on Friday, when the market will close at 1:00 p.m. ET. (alg)

Source: CNBC.com