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US stocks rise on data showing virus cases in US declining

By SCOTT REEVES in New York | | Updated: 2020-04-09 00:20
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US stocks rose moderately on the opening Wednesday as data showed the number of new coronavirus cases in the US appears to be declining.

Johns Hopkins University reported that the number of new cases in the US has fallen since Friday. Anthony Fauci, director the National Institute of Allergy and Infections Diseases, said Wednesday the number of people dying from coronavirus infection is lower that anticipated and there could be a significant improvement in the outlook this week. But he said efforts to limit the spread of the virus should be stepped up.

It's unclear how the US will restart its $22 trillion economy, creating future uncertainty and the possibly of volatile trading ahead.

The Dow Jones Industrial Average traded up 200.14 points in early trading, or 0.88 percent, to 22,847.20. The S&P 500 rose 0.73 percent and the Nasdaq Composite rose 0.76 percent.

Volatility returned to the market Tuesday. After opening strongly and climbing in early trading to a gain a total of about 985 points for the day, the market turned negative and closed 26 points in the red.

Year-to-date, the Dow is down 20 percent for the year. In 2008, the collapse the subprime mortgage market hammered stocks and the 30-stock blue chip index lost 33.64 percent.

The Dow is 22.96 percent below its all time intraday high of 29,568.57 reached Feb. 12.

The S&P 500 Index closed down 0.16 percent Tuesday. It's down 17.45 percent year-to-date.

Many stocks offer higher returns, but investors must determine their tolerance for risk. Volatile trading in equities suggests there is no clear way to price risk during the coronavirus outbreak, also called COVID-19.

West Texas Intermediate crude oil futures rose 3.4 percent Wednesday to $24.42 a barrel, but still remain too low for most US producers.

The American Petroleum Institute said inventories of crude oil rose. Excess supply keeps prices low – good for drivers, but bad for producers. Analysts expect cutbacks in production. The price of oil is often viewed as a proxy for future economic activity.

In early trading, Exxon Mobil, Sunoco, Marathon and ConocoPhillips rose but Chevron fell.

Tesla, a maker of high-end electric cars, said it will cut salaries and furlough all non-essential employees as it suspends production. The company plans to resume production May 4. The company's stock fell 0.20 percent.

Boeing announced two software updates for the grounded 737 MAX. The company hopes the plane will be recertified for commercial service this summer, but the Federal Aviation Administration has consistently said there is no deadline for approval of the software and getting the plane back in the air. Boeing's stock gained 5.25 percent in early trading.

The yield on the 10-year US Treasury bond edged up to 0.750 percent from 0.835 percent Tuesday, suggesting investors remain cautious.

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