U.S. Markets Rally Amid Hopes That Pandemic Spread Is Slowing

  • U.S. Markets Rally Amid Hopes That Pandemic Spread Is Slowing

U.S. Markets Rally Amid Hopes That Pandemic Spread Is Slowing

Markets in Europe and Asia also rose almost as much.

The gains come on the heels of solid gains on Monday after NY and New Jersey showed tentative signs of a "flattening" of the virus outbreak.

U.S. stocks experienced a massive rebound Monday at the start of the second week of the fiscal year's new quarter, with the Dow Jones Industrial Average index gaining over 1,500 points amid the release of data suggesting that COVID-19 cases are leveling out somewhat.

Italy over the weekend reported its lowest death toll in two weeks and France its fewest dead in a week, while Spain recorded lower fatalities for a fourth straight day Monday.

The announcement pushed Japan's Nikkei 225 index to surge 4.2 per cent.

In a note to clients, Rosenberg Research and Associates chief economist and markets strategist David Rosenberg said the rally does not carry the hallmarks of a true bull run.

During the financial crisis of 2007-08, the S&P 500 remains almost 20% - or $6 trillion in market value - short of its all-time high in mid-February.

The latest gains are not likely to have much staying power, given how much uncertainty remains about when the pandemic will subside significantly and how much harm will have been inflicted to the economy, said Nela Richardson, investment strategist at Edward Jones.

Hong Kong's Hang Seng rose 2.3% to 23,758.32.

"This is looking more like a bear market rally", said Nancy Perez, senior portfolio manager at Boston Private Wealth in Miami. "I wouldn't take the uptick over the last two weeks as a sign of a bottoming or a sign of upside recovery from here on out". The FTSE 100 in London rose 3.1%.

But a peak in new cases would give some clarity on how long the downturn may last and how deep it would be.

The S&P 500 is still down more than 22% since its record set in February, but the losses have been slowing since Washington promised massive amounts of aid to prop up the economy. "There are literally no governors on the amount of monetary or fiscal stimulus that will be used in this fight". The plan is due to be outlined Tuesday, when Prime Minister Shinzo Abe is expected to announce a state of emergency that will ramp up precautions meant to curb the rapid spread of the virus.

Crude oil fell, giving up some of its huge gains from the prior week when expectations rose that Saudi Arabia and Russian Federation may cut back on some of their production.

Oil prices fell back after a meeting between OPEC and Russian Federation reportedly was delayed until April 9.

Oil gained some ground in early trading, with USA benchmark West Texas Intermediate rising modestly on speculation Saudi Arabia and Russian Federation might be able to reach a truce in their price war. On Friday, it climbed 11.9% to $28.34 per barrel, adding on to its almost 25% surge the day before.

The world is awash in oil as demand for energy collapses, and President Donald Trump said Thursday that the rivals may be close to cutting back on production to prop up oil's price. It started the year above $60 per barrel.

Brent crude, the worldwide standard, gave up 41 cents to $33.70 per barrel.

In currency trading, the dollar rose to 109.09 Japanese yen from 108.48 yen on Friday. The euro rose to $1.0808 from $1.0792.