By Yasin Ebrahim
Investing.com – The Dow rose Wednesday as a rebound in oil prices and fresh stimulus from Congress to combat the Covid-19 pandemic renewed investor appetite for risk.
The Dow rose 2.31%, or 532 points, theS&P 500 gained 2.52% and the Nasdaq Composite rose 3.01%.
WTI oil prices rallied, shrugging off another large build in weekly crude inventories and underpinned a strong bid in energy stocks.
The EIA said crude oil stockpiles surged by 15 million last week to 518.6 million, the most since May 2017.
The recent plunge in oil, however, has been downplayed by some on Wall Street, who argue that energy only accounts for a somewhat marginal proportion of the broader market and has had little impact on other assets.
"Energy now only accounts for about 3% of the S&P 500," JPMorgan (NYSE:JPM) said. "For all the headlines around crude, the cross-asset impacts have been contained."
Technology, meanwhile, rose sharply.
Alphabet (NASDAQ:GOOGL) rose 5.6% and Facebook (NASDAQ:FB) gained 7.9%. Snap's (NYSE:SNAP) blowout quarter indicated that fears of a material slump in advertising spending due to the coronavirus pandemic may have been somewhat overdone.
Snap surged 32% after reporting that revenue, which is mainly driven by advertising, grew by 44% in the first quarter, with daily active users, up 20% from last year.
Delta Air Lines (NYSE:DAL) gave up earlier gains to trade 3% lower after reporting a quarterly loss that was not as bad as many had feared. But the company did, however, offer up a gloomy outlook ahead, warning it could take two to three years to recover from the pandemic.
American Airlines (NASDAQ:AAL) and United Airlines (NASDAQ:UAL) sank about 7%.
Elsewhere on the earnings front, AT&T (NYSE:T) fell 1.5% after the telecoms giant missed quarterly earnings estimates as the impact from the coronavirus hit earnings by a $435 million.
Investor sentiment was also supported markets by expectations for a fresh wave of stimulus after lawmakers on Capitol Hill reached a deal on a $500 billion coronavirus package to further support the economy.