KEY POINTS

  • Russia and OPEC have postponed meeting to discuss price cut
  • Coronavirus death rates may have peakedin key European countries
  • Crude oil futures were down almost 7%

 

U.S. stocks surged on Monday as coronavirus death rates in Europe appear to be levelling off, while the number of fatalities in New York, the epicenter of the U.S. epidemic, may have peaked.

The Dow Jones Industrial Average surged 1,627.46 points to 22,679.99, while the S&P 500 rose 175.03 points to 2,663.68 and the Nasdaq Composite Index gained 540.15 points to 7,913.24.

Volume on the New York Stock Exchange totaled 5.21 billion shares with 2,742 issues advancing, six setting new highs, and 265 declining, with 17 setting new lows.

Active movers were led by Carnival Corp. (CCL), American Airlines Group Inc. (AAL) and Delta Air Lines Inc. (DAL)

New York State Gov. Andrew Cuomo said the state reported 594 coronavirus deaths on Sunday, down from 630 on Saturday, the first such daily decline in coronavirus-related deaths.

Death rates in Europe also appear to be levelling off, particularly in Spain, Italy, Germany and France.

British Prime Minister Boris Johnson has been moved to intensive care after his coronavirus symptoms have worsened.

However, oil futures keep falling as OPEC and Russia postpone a meeting to discuss production reductions. U.S. President Donald Trump said last week he expected both Russia and Saudi Arabia to cut output by up to 15 million barrels.

“Incoming data suggests [New York] state might peak sooner than Cuomo’s optimistic case,” said Tom Lee, head of research at Fundstrat. “With better visibility on the healthcare crisis in the U.S., particularly, on a potential to model a national peak, we believe buyers are now taking control.”

“I am beginning to get optimistic,” tweeted Bill Ackman, CEO of hedge fund manager Pershing Square. “[Coronavirus] cases appear to be peaking in [New York]. Almost the entire country is in shutdown.”

However, the U.S. still has more than 330,000 cases. On Saturday, Trump warned, “there will be a lot of death,” adding that the U.S. faces its “toughest week” against the virus.

“If we are fortunate to see an effective treatment there will be plenty of capital gains opportunities. For me capital preservation is more important than capital gains,” said Marc Chaikin, CEO of Chaikin Analytics. “Use sharp bear market rallies, like we saw last week, to raise sufficient cash to enable you to withstand further declines without panicking.”

“We are still optimistic that the [Trump] administration will be able to get this virus under control and reopen the economy by the end of April, early May,” said Lindsey Piegza, chief economist at Stifel Nicolaus & Co.. “If that does occur, it’s likely that we’re able to control the downturn from a depressionary scenario into a recessionary scenario.”

Overnight in Asia, markets were mixed. China’s Shanghai Composite slipped 0.6%, while Hong Kong’s Hang Seng gained 2.21%, and Japan’s Nikkei-225 surged 4.24%.

In Europe markets closed broadly higher, as Britain’s FTSE-100 jumped 3.08%, France’s CAC-40 gained 4.61% and Germany’s DAX surged 5.77%.

Crude oil futures dropped 6.7% at $26.44 per barrel, Brent crude gained 0.3% at $33.15. Gold futures gained 3.71%.

The euro edged up 0.01% at $1.08 while the pound sterling slipped 0.11% at $1.2253.

The yield on the 10-year Treasury surged 15.16% to 0.676% while yield on the 30-year Treasury gained 5.77% to 1.284%.