U.S. stocks end higher, with all the three major benchmarks indexes closing at record highs
Stocks posted another round of records amid signs of a slowdown in the number of new coronavirus cases
U.S. stocks ended higher Wednesday, with all three major benchmarks indexes registering all-time closing highs, buoyed by signs of a slowdown in the number of new cases of COVID-19 — a strain of coronavirus that emerged in Wuhan, China late last year.
All the major benchmarks indexes closed at record highs as the Dow Jones Industrial Average DJIA, +0.94% rose 275.08 points, or 0.9%, to end at 29,551.42, while the S&P 500 SPX, +0.65% added 21.70 points or 0.7%, to finish at 3,379.45. The Nasdaq Composite Index COMP, +0.90% ended at 9,725.96, a gain of 87.02 points, or 0.9%.
China’s National Health Commission on Wednesday said 2,015 new cases of the disease caused by the new viral infection had been reported over the last 24 hours, declining for a second day. That brought the number of cases in mainland China to 44,653, although experts have warned that a substantial number may have gone uncounted. The commission said there were 97 additional deaths from the virus in the last 24 hours, bringing the mainland total to 1,113.
While many analysts have attributed market gains to the slowing pace of contagion, some contend the positive reaction may be premature.
The ultimate impact of the coronavirus on global growth is uncertain, as is the time frame for when the spread of the virus will peak, said Scott Wren, senior global market strategist at Wells Fargo Investment Institute, in a note.
The market seems to be pricing in a virus that will be at least somewhat contained in the nearer term. But it is no surprise that the accuracy of Chinese data related to the spread and death toll of the coronavirus has been in question since the outbreak was first reported, he said.
That has contributed to selling pressure in the market the past two Fridays. The trend could continue in the near term as traders seek to “pack lightly” for the weekend, Wren said, avoiding holding large speculative positions that could take a hit from headlines about the viral outbreak when markets reopen.
In testimony before the Senate Banking Committee, Powell said the Fed had two recession-fighting tools: buying government bonds in an effort to push down long-term interest rates, a strategy known as quantitative easing; and communicating clearly with markets about the path of interest-rate policy.
Oil prices ended higher. The price of a barrel of West Texas Intermediate crude for March delivery CLH20, -0.08% rose 2.5% to $51.17 on the New York Mercantile Exchange.
In precious metals, gold for April delivery GCJ20, +0.41% erased an early loss to eke out a 0.1% gain.
The U.S. dollar DXY, -0.08% was 0.2% higher relative to a basket of its peers.
U.S. government bonds sold off, pushing up yields, with the benchmark 10-year note rate TMUBMUSD10Y, -2.34% up 4.7 basis points to 1.63%. Bond prices move inversely to yields.
In Europe, the Stoxx Europe 600 SXXP, +0.63% closed 0.6%, or 2.68 points, higher, at 431.16. The FTSE 100 FTSE, +0.52% jumped 0.5%, or 34.93 points, to close at 7,534.37.
In Asia overnight, the China CSI 300 000300, -0.61% rose 0.8% to 3,984.43, while the Hang Seng Index HSI, -0.27% was 0.9% higher, at 27,823.66.
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