Wednesday’s Stock Market Open: US Equities Rise On Continued Optimism Over Economy Reopening

Update: 12:05 p.m. EDT:

U.S. stocks turned mixed in noon Wednesday trading.

The Dow Jones Industrial Average rose 228.62 points to 25,223.73, while the S&P 500 gained 3.92 points to 2,995.69 and the Nasdaq Composite Index dropped 98.94 points to 9,241.28.

In Europe markets finished higher, as Britain’s FTSE-100 gained 1.26%, while France’s CAC-40 climbed 1.79% and Germany’s DAX rose 1.33%.

Original story:

U.S. stocks jumped on Wednesday on hopes that as more businesses and states reopen the economy can rebound from the devastating impact of the covid-19 pandemic.

The Dow Jones Industrial Average surged 355.24 points to 25,350.35, while the S&P 500 gained 28.08 points to 3,019.85 and the Nasdaq Composite Index rose 11.61 points to 9,351.83.

The European Commission has released plans for a 750 billion euro ($826.5 billion) recovery fund to aid the countries hardest hit by the virus.

The Trump administration may impose sanctions on Chinese companies and officials over Beijing’s efforts to tighten its control over Hong Kong. President Donald Trump said he will announce his response to the matter by the end of this week.

Data released Tuesday suggested the economic impact of covid-19 in the U.S. has maxed out.

“For the first time in this crisis, we are being bombarded by good news,” said Jim Paulsen, chief investment strategist at the Leuthold Group. “The S&P 500 finally breaks above its 200-day moving average (3000)” and “more new vaccine drugs look promising.”

Michael Darda, MKM Partners chief market strategist and chief economist, said: “Certainly the market has been making a V-pattern upward and there’s been a tremendous amount of skepticism around that but we are just starting now to see some evidence in the data turning. Some better than expected housing numbers. As reopening gets underway, virtually all states now we are starting to see activity bounce off of very low levels.”

In Japan, the Abe administration is about to unveil a new 117 trillion yen ($1.1 trillion) stimulus package.

“[The recent stock rally] “is an indication that investors are getting optimistic about the reopening of the economy and the drug-treatment development,” said Katerina Simonetti, senior portfolio manager at UBS Private Wealth. “We hope that it will eventually lead to a normalization in the market, but we have to keep an eye on the re-emergence of virus cases.”

Overnight in Asia, markets finished narrowly mixed. The Shanghai Composite edged down 0.34%; Hong Kong’s Hang Seng slipped 0.36%; while Japan’s Nikkei-225 rose 0.7%.

In Europe markets traded higher, as Britain’s FTSE-100 gained 1.54%, while France’s CAC-40 climbed 2.23% and Germany’s DAX rose 1.81%.

Crude oil futures dropped 2.21% at $33.59 per barrel, Brent crude fell 2.07% at $35.98. Gold futures fell 1.11%.

The euro gained 0.14% at $1.0998 while the pound sterling slipped 0.58% at $1.2263.