(Reuters) – U.S. stock markets rose on Wednesday on hopes the coronavirus outbreak in the United States was close to its peak, with health insurers boosted by Democratic presidential candidate Bernie Sanders suspending his campaign.
FILE PHOTO: The Wall Street sign is pictured at the New York Stock exchange (NYSE) in the Manhattan borough of New York City, New York, U.S., March 9, 2020. REUTERS/Carlo Allegri
After the worst March for decades, the past two weeks has seen Wall Street’s main markets recover some poise, although its main indicator of future volatility remains historically high.
Sanders’ embrace of a Medicare for all healthcare policy would have essentially abolished private insurance and had cast a shadow on healthcare stocks for months.
The news added to early gains after President Donald Trump said the United States might be getting to the top of the “curve” in relation to the outbreak, even as New York and several other states posted their highest number of daily virus-related fatalities.
“The general trend is that it’s gradually getting better. Flattening of the curve is very minor, but it’s enough for an inkling of hope,” said Randy Frederick, vice president of trading and derivatives for Charles Schwab in Austin, Texas.
The benchmark S&P 500 is still down nearly 20% from its record high in mid-February, despite big gains early this week, as measures to contain the virus brought the U.S. economy to a virtual halt.
Spirit’s shares jumped over 12%, while Tesla rose about 1%.
Top U.S. Democrats in Congress said on Wednesday they would back the Trump administration’s request for $250 billion more in aid for small businesses if it includes additional money for hospitals, local governments and food assistance.
The package would add to the $2.3 trillion in stimulus already approved and meant to make up for the wages and incomes lost after Americans were ordered to stay home.
Early gains were led by the energy index .SPNY, which rose over 3%, as oil stocks tracked crude prices higher and risk appetite was boosted by the prospect of more fiscal stimulus.
At 1:36 p.m. ET the Dow Jones Industrial Average .DJI was up 461.49 points, or 2.04%, at 23,115.35, the S&P 500 .SPX was up 53.53 points, or 2.01%, at 2,712.94 and the Nasdaq Composite .IXIC was up 133.60 points, or 1.69%, at 8,020.86.
Corporate earnings season starts next week with the major Wall Street banks, and companies are expected to outline more drastic measures to bolster dwindling cash reserves.
“Investors are bracing themselves for a terrible earnings season and are going to try to look for clues on what businesses will see more normalized operations,” said Yung-Yu Ma, chief strategy officer at BMO Wealth Management in Portland.
Advancing issues outnumbered decliners by a 5.52-to-1 ratio on the NYSE. Advancing issues outnumbered decliners by a 4.18-to-1 ratio on the Nasdaq.
The S&P index recorded 2 new 52-week highs and no new lows, while the Nasdaq recorded 3 new highs and 15 new lows.
Reporting by Uday Sampath, Medha Singh and Shreyashi Sanyal in Bengaluru; Editing by Sriraj Kalluvila and Shounak Dasgupta