Traders at the New York Stock Exchange. (Photo: AP)
U.S. stocks surged to the second 4% rally in three days after Congress authorized nearly $8 billion for virus prevention a day after the Federal Reserve slashed interest rates and investors warmed to Joe Biden's ascendant candidacy. Treasuries fell for just the second time in 10 days.
The S&P 500 surged into the close, nearly matching Monday's rally that was the best in 14 months. Health-care firms led the spike, rising the most since November 2008 as the weak performance in Tuesday's primaries by Bernie Sanders dented the threat of policies that would upend the industry.
"It looks like a combination of two things: Biden's showing on Super Tuesday is really an unexpected surprise, a positive surprise to the markets because markets always prefer a more moderate centrist Democratic nominee," Deepak Puri, Americas CIO at Deutsche Bank Wealth Management, said by phone. "The other is the G-7 coordinated fiscal and monetary policy easing, which is on top of the 50 basis-point rate cut by the Fed announced yesterday."
Stocks opened higher on speculation other central banks and governments would provide stimulus as the outbreak claimed more lives and new cases piled up. New York reported five new cases Wednesdsay and California had its first related death. The S&P 500 has now surged more than 6% this week, a rebound that began Friday when the Fed pledged support. The S&P 500 is still more than than 7% below its February record.
