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Wall Street surges on Biden bounce

Stock MarketsMar 04, 2020 05:01PM ET
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© Reuters. A trader works on the floor at the NYSE in New York

By Stephen Culp

NEW YORK (Reuters) - Wall Street roared back to life on Wednesday, with both the Dow and the S&P 500 surging more than 4%, after former Vice President Joe Biden's strong showing in the Super Tuesday Democratic primary contests injected a dose of confidence.

Biden's pack-leading results - on course to win in 10 of the 14 states that held primaries on Tuesday - powered a jump in healthcare stocks, and upbeat economic data soothed worries about the impact of the spreading coronavirus outbreak.

After the S&P 500 reached an all-time high on Feb. 19, the stock market slid into a correction as the rapidly spreading COVID-19 sparked recession fears.

The S&P 500 has recovered nearly 6% from Friday's closing trough, but remains about 7.6% below the all-time high reached on Feb 19.

The S&P 500 healthcare index (SPXHC) had its best day since November 2008, advancing 5.8%. Health insurers, in particular, gained ground, with the S&P 500 Managed Care index <.SPLRCHMO> jumping 12.4%.

Biden emerged as the front-runner in a narrowing race for the Democratic presidential nomination following a string of primary victories, providing relief to market participants who are wary of the more progressive policy positions of rival Bernie Sanders, a self-described democratic socialist. Sanders' embrace of a Medicare for All healthcare policy that would essentially abolish private insurance had cast a shadow on healthcare stocks.

"It's a relief to the market that it appears that Joe Biden is increasingly likely to get the Democratic nomination," said Oliver Pursche, vice chairman and chief market strategist at Bruderman Asset Management in New York.

"Many Americans, even those inclined to agree with Trump's policies, are clamoring for a unifying voice," Pursche added. "And Joe Biden is about as benign as anyone can be."

Biden's showing acted at a balm to investors day after the market slumped following the U.S. Federal Reserve's emergency 50-basis-point interest rate cut to head off potential economic damage from the coronavirus outbreak. There are now 93,000 confirmed coronavirus cases worldwide.

"(The Fed's rate cut) coming two weeks before a policy meeting signals a certain level of panic," said Pursche. "We're all worried about the coronavirus and the economic impact but so far the data has held up."

Indeed, separate data released on Wednesday showed stronger-than-expected private sector hiring, while the services sector expanded at its fastest pace in a year.

Additionally, the Mortgage Bankers Association reported that the average 30-year fixed contract mortgage rate fell last week to a seven-year low.

The Dow Jones Industrial Average (DJI) rose 1,173.45 points, or 4.53%, to 27,090.86, the S&P 500 (SPX) gained 126.75 points, or 4.22%, to 3,130.12 and the Nasdaq Composite (IXIC) added 334.00 points, or 3.85%, to 9,018.09.

All of the 11 major sectors in the S&P 500 posted solid advances, led by healthcare and utilities (SPLRCU).

Dollar Tree Inc (O:DLTR) forecast underwhelming first-quarter sales and profit, sending the discount retailer's shares down 3.6%.

Abercrombie & Fitch Co (N:ANF) jumped 9.0% after beating quarterly sales and profit estimates.

Campbell Soup Co's (N:CPB) beat-and-raise earnings report gave a 10.1% boost to its shares.

Advancing issues outnumbered declining ones on the NYSE by a 5.34-to-1 ratio; on Nasdaq, a 3.64-to-1 ratio favored advancers.

The S&P 500 posted eight new 52-week highs and 31 new lows; the Nasdaq Composite recorded 37 new highs and 130 new lows.

Volume on U.S. exchanges was 11.04 billion shares, compared with the 10.00 billion average over the last 20 trading days.

Wall Street surges on Biden bounce
 

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Comments (28)
Christopher Tran
Christopher Tran Mar 05, 2020 1:14AM ET
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Most of the bounce was due to the financial aid for the corona virus pandemic. Biden didnt do squat
Malaki Philippines
BuyDipsSellTips Mar 04, 2020 10:27PM ET
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Biden likes to touch kids
william docauer
william docauer Mar 04, 2020 8:46PM ET
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Terrible article,. The market went up cause the Communist Old Fool didn't do as good as CRAZY JOE. That's all.
Space Lord
Space Lord Mar 04, 2020 8:46PM ET
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Terrible lie
Chris Martin
Chris Martin Mar 04, 2020 3:36PM ET
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You ladies fail to discuss the impact of what could occur if the Durham indictments focus on any way on Fuzzy Joe and his family members. A true leap of faith. I personally thought that's why the short man was "in". And leave Jabba The Hut out of the equation -
James Westmore
James Westmore Mar 04, 2020 1:37PM ET
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WH ... LOL!! Biden??!?! You got to be kidding me!!
Luu Hung
Luu Hung Mar 04, 2020 1:30PM ET
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On be half of this site. I wanna say We're gonna have super big giant massive huge Wednesday. another 3% up tomorrow. Btfd !!!
Warren Goldstein
Warren Goldstein Mar 04, 2020 1:25PM ET
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Doesn't matter which one of Sleep Joe or the Communist wins. My boy Donny will trounce either one of them.
Andrew carson
Andrew carson Mar 04, 2020 1:10PM ET
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Nothing to do with sleepy Joe.
Gill Bowaly
Gill Bowaly Mar 04, 2020 1:10PM ET
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economy boots as sanders will not be president
Malaki Philippines
BuyDipsSellTips Mar 04, 2020 1:00PM ET
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They are all corrupt
rob finch
rob finch Mar 04, 2020 12:55PM ET
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The markets prefer a half socialist to a full socialist. Who wouldn't?
Pwr Strk
Pwr Strk Mar 04, 2020 12:53PM ET
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at least we can agree that even Bernie Sanders' initials are BS
Thom Miller
Thom Miller Mar 04, 2020 12:26PM ET
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The markets are rallying because traders all know that the Obama-Biden team has long been responsible for the economy’s strength these past 11 years and that Trump’s slow response to the coronavirus threat has been to its detriment.
Warren Goldstein
Warren Goldstein Mar 04, 2020 12:26PM ET
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Complete nonsense, on all counts.
Johnny Crash
Johnny Crash Mar 04, 2020 12:13PM ET
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How would markets benefit from lazy Joe? It's laughable
katya litski
katya litski Mar 04, 2020 12:13PM ET
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cause Bernie is the death of investments
Thom Miller
Thom Miller Mar 04, 2020 12:13PM ET
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Last I checked the Obama-Biden team made us all oodles of money in the stock market. And, yes, you’re right.....I’m laughing all the way to the bank. LOL!
Luis Cortes
Luis Cortes Mar 04, 2020 11:37AM ET
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if joe biden is the reason for the rally....SHORT THIS MARKET IMMEDIATELY!!
jj ff
jj ff Mar 04, 2020 11:27AM ET
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Here we go. Leftist fake news starting their anti Trump pile on to prop up Biden. Ain't gonna work.
John Mage
John Mage Mar 04, 2020 11:17AM ET
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joke story lol
Marec Huber
Marec Huber Mar 04, 2020 10:22AM ET
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"Yes", a poor description reason for a title headline.Better luck next time.
Marec Huber
Marec Huber Mar 04, 2020 10:17AM ET
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Same as saying the market is up because the sky is blue.Do many people start buying stocks for such a reason ? Really !? Laughing.Id say logically, buyers beware ?We will see, soon, it its right wont we.
Andrew Beason
Andrew Beason Mar 04, 2020 10:07AM ET
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poor Bernie getting shoved under the bus again. He should have learned after last time they will not let him win.
trung le
trung le Mar 04, 2020 10:02AM ET
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cant fault you for using catchy headlines but...its pathetic and its false
John Snoberger
John Snoberger Mar 04, 2020 10:02AM ET
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Tuli Namwandi
Tuli Namwandi Mar 04, 2020 9:53AM ET
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What's the direction?
Pwr Strk
Pwr Strk Mar 04, 2020 9:52AM ET
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Lol.... Reuters with a joke, trying to fake it as usual
FM VILLEGAS
FM VILLEGAS Mar 04, 2020 9:52AM ET
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Nobody is buying that!!!
Herbert Booker
Herbert Booker Mar 04, 2020 9:51AM ET
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Biden will save us all. No pressure.
Pwr Strk
Pwr Strk Mar 04, 2020 9:51AM ET
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lol, i hope you said that with all sarcasm
 
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