Wall Street rose on Wednesday on hopes the coronavirus outbreak in the United States was close to its peak and expectations that Congress will inject hundreds of billions more in the battered economy.
President Donald Trump said late on Tuesday 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.
A peaking in new virus cases is widely considered one of the first steps that will push markets into a recovery, but such signals are still tentative and corporate layoffs, cutbacks and losses show no signs of slowing.
“The stock markets are forward looking, so there’s anticipation that, hopefully sooner rather than later, the death count will be less than anticipated,” said Marc Pfeffer, chief investment officer at CLS Investments in Westchester County, New York.
“I’d like to think that the bottom has been put in, but we can’t say for sure. The conversations are now starting to move towards the reopening of the economy.”
The benchmark S&P 500 is down nearly 20 per cent from its record high in mid February, despite big gains early this week, as measures to contain the virus brought the US economy to a virtual halt.
Tesla Inc and Boeing Co supplier Spirit AeroSystems became the latest companies to furlough workers as the pandemic forces the closure of US production facilities.
Democratic Congressional leaders said on Wednesday they would back the Trump administration’s request for another $US250 billion ($A402 billion) in aid for small businesses.
The package would add to the $US2.3 ($A3.7) 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 on Tuesday were led by the energy index as oil companies rose tracking crude prices and risk appetite was boosted by the prospect of more fiscal stimulus.
At 10:36 local time on Wednesday, the Dow Jones Industrial Average was up 223.03 points, or 0.98 per cent, at 22,876.89, the S&P 500 was up 25.20 points, or 0.95 per cent, at 2,684.61 and the Nasdaq Composite was up 67.94 points, or 0.86 per cent, at 7,955.20.
Corporate earnings season starts next week with the major Wall Street banks, and companies are expected to outline more drastic measures as they look to bolster dwindling cash reserves.
Analysts now expect first-quarter earnings for S&P 500 firms to fall 7.5 per cent compared to a Jan. 1 forecast for a rise of 6.3 per cent.
Shares of UPS and FedEx rose 3.51 per cent to 6.26 per cent after Amazon.com Inc said it would suspend its US shipping service.
Advancing issues outnumbered decliners for a 3.29-to-1 ratio on the NYSE and a 2.67-to-1 ratio on the Nasdaq.
The S&P index recorded one new 52-week high and no new low, while the Nasdaq recorded two new highs and nine new lows.