A worldwide rally gained steam on Wall Street on Monday, propelling major indexes up more than 7%, as traders cheered glimmers of hope that the deadliness of the coronavirus outbreak could be slowing in some of the hardest-hit areas.
The Dow Jones industrial average closed up 1,597 points, or 7.6 percent, to 22,649.74. The S&P 500 jumped 175 points, or 7 percent, to 2,663.68. The tech-heavy Nasdaq bounced 540 points, or 7.3 percent, to finish at 7,913.24.
Stocks surged the most in almost two weeks after the reported death tolls in some of the world’s coronavirus hot spots showed signs of easing. The yen weakened and Treasurys fell.
New York Gov. Andrew Cuomo, D, said earlier that deaths were showing signs of hitting a plateau in the state that has become the epicenter of the U.S. outbreak. Italy had the lowest number of new coronavirus infections in nearly three weeks and France reported a continued leveling-off of cases, helping to send European and Asian shares higher.
“You can’t say that we’ve definitely turned the corner for certain but it does appear as though that is a good sign,” said Mark Heppenstall, chief investment officer at Penn Mutual Asset Management, which oversees $28 billion.
The number of deaths in the U.S. is still expected to peak on April 16, though the cumulative number of Americans likely to die of covid-19 was revised downward to 82,000, from an estimate of 94,000 less than a week ago. But at its apex, 3,130 Americans will die per day, up from the previous estimate of 2,644.
The pound weakened after British Prime Minister Boris Johnson was taken into a hospital intensive care unit for treatment for coronavirus after his condition worsened.
The mostly upbeat tone in markets followed another negative week, and the mood among investors remains divided. Bulls are pointing to more attractive valuations, unprecedented stimulus and now slowing death rates in several major countries. Bears are fretting the continued spread of the disease, dismal economic data and the rising corporate costs of the pandemic and subsequent shutdown.
“For now the markets will likely remain hostage to news on how long it will take to ‘get back to business’ and ‘the good life,’ ” John Stoltzfus, the chief investment strategist at Oppenheimer & Co., wrote to clients. “We’d expect markets to continue trading on a combination of fear, technical factors and wistful hope with fundamentals clouded by the uncertainty weaved by the insidious virus.”
In Asia, Japan’s benchmark ended almost 4% higher even as that country moved closer to declaring a state of emergency. The yen dropped as haven demand receded. Shares in Hong Kong rose while Shanghai was closed for a holiday.
Elsewhere, crude oil fell on signals that a glut is growing at America’s key oil storage hub, offsetting earlier support from signs that Saudi Arabia and Russia are making progress toward a supply-curb agreement.