Wall Street Close: Benchmarks recovering from coronavirus blues
- The DJIA added 143.78 points, or 0.5%, to end t 28,399.80.
- The S&P 500 index put up 23.40 points, or 0.7%, to close at 3,248.92.
- The Nasdaq Composite Index also moved higher, adding 122.47 points to 9,273.40, a gain of 1.3%.
US benchmarks were trying to recover and pull themselves out from the coronavirus sickbed following a rout in China as traders returned from the prolonged holidays to face a barrage of stimulus measures from the Chinese authorities seeking to stimulate an ill economy. However, the optimism lived on Wall Street and we saw subsequent gains across the board, albeit below session highs for all three benchmarks.
The Dow Jones Industrial Average, or DJIA, added 143.78 points, or 0.5%, to end t 28,399.80, while the S&P 500 index put up 23.40 points, or 0.7%, to close at 3,248.92. The Nasdaq Composite Index also moved higher, adding 122.47 points to 9,273.40, a gain of 1.3%. The performances were valiant and were a far cry from Friday's washout where the DJIA lost 603.41 points, or 2.1%, while the S&P 500 dropped 1.8% and the Nasdaq Composite gave up 1.6%.
Forex Today: China's 'band-aid' efforts offset coronavirus led stocks crash; PMIs in focus
It was a bit of a blood bath overnight with China returning. Yohay Elam, Senior Editor and Analyst at FXstreet update us on the Coronavirus news as follows:
Coronavirus news: The number of official cases has topped 17,000, and the death toll is around 360. The first death outside China has been reported, and additional airlines have limited flights to the mainland. Testing kits have improved, and medicine used for HIV may help in curing the virus. The worst is probably still ahead.
Coronavirus market response: Chinese markets have reopened after the New Year's holiday with a sharp downfall, carrying down prices of metals. The People's Bank of China cut interest rates
Meanwhile, European and US data were positive again. For Wall Street, the bulls were impressed with the outcome of the January ISM beat expectations, printing above 50 for the first time in six months.
"The index rose to 50.9 vs 47.8. New orders rose 4.4 pts to 52.0, prices paid firmed (53.3 vs 51.7) and employment also lifted a touch (46.6 vs 45.2). Export orders surged to 53.3 vs 47.3, the highest reading since September 2018, showing significant relief at the Phase One trade deal," analysts at ANZ Bank explained.
However, the analysts at ANZ warn that the measures taken in China to contain the novel coronavirus are expected to weigh on demand, making it difficult for China to meet its Phase One purchasing targets. "The agreement does, however, include a clause that the two sides will consult in the event that a natural disaster or other unforeseeable event delays compliance. Chinese officials are reportedly hopeful that the US will agree to some flexibility."