Dow surges 1,173 points on Biden wins, coronavirus funding
The Dow rose more than 1,000 points on Wednesday as Wall Street cheered Joe Biden’s surprise Democrat primary wins over Sen. Bernie Sanders.
The Dow Jones industrial average closed the day up 1,173.45 points, or 4.5 percent, to 27,090.86 on Biden’s Super Tuesday surge to the front of the Democratic presidential race ahead of Sanders, who has pledged to impose a wealth tax and create a single-payer health care system.
Stocks were also buoyed by growing signs of a strong government response to the coronavirus threat, including US lawmakers reaching an $8 billion deal to combat its spread. Some $2.2 billion will go to preventing the virus from spreading and another $3 billion will go to developing a treatment.
The S&P 500 rose 4.1 percent to 3,130, while the Nasdaq composite ended the day up 3.8 percent to 9,018.
Health care stocks did especially well as the prospects of Sanders’ “Medicare for All” proposal dimmed — UnitedHealth Group shares jumped more than 10 percent to end the day at $289.42, while CVS shares ended the day up 5.6 percent to $66.04.
“Mr. Biden doesn’t terrify the top one percent and corporate America, nearly as much as Mr. Sanders,” Jeffrey Halley, senior currency analyst at OANDA, wrote in a Wednesday commentary.
Wall Street is also likely encouraged by the floundering campaign of Sen. Elizabeth Warren, who supports many of the same policies as Sanders but is viewed as having more expertise, according to Ritholtz Wealth Management CEO Josh Brown. Warren won no Super Tuesday contests and finished behind Biden in her home state of Massachusetts.
“Stocks will be even more relieved at Warren’s coming concession as they are at Biden’s big showing,” Brown said on Twitter.
The Dow plunged 786 points Tuesday as the Fed’s first emergency rate cut since 2008 failed to quell traders’ fears about the coronavirus weakening the world economy. The outbreak has killed more than 3,000 people — including at least nine in the US — and threatened to slash economic growth this year.
The stock markets have been volatile amid fears about the coronavirus spreading further outside China. The Dow gained nearly 1,300 points Monday, its biggest single-day point gain ever, after shedding more than 3,500 points in Wall Street’s worst week since 2008.
Source: Read Full Article