US open: Stocks continue rally on encouraging signs from worst-hit countries
By Iain Gilbert
Date: Tuesday 07 Apr 2020
(Sharecast News) - US stocks opened higher on Tuesday, continuing on the sharp gains recorded in the previous session.
As of 1535 BST, the Dow Jones Industrial Average was up 2.45% at 23,235.23, while the S&P 500 was 2.00% firmer at 2,716.90 and the Nasdaq Composite came out the gate 1.39% stronger at 8,023.12.
The Dow opened 555.24 points higher on Tuesday after major indices soared in the previous session on the back of an overall more optimistic tone around the Covid-19 pandemic from the White House at a press conference over the weekend.
The strong moves came after South Korea reported less than 50 new cases of Covid-19 for a second day in a row, while China posted no new deaths for the first time since it started publishing daily updates in January.
Also underlining sentiment were comments from Donald Trump, who said on Monday that there was "tremendous light at the end of the tunnel". World Health Organization officials also said research to develop vaccines and treatments for the virus had "accelerated at incredible speed".
Oanda analyst Craig Erlam said: "There are really encouraging signs that the worst-hit countries in Europe are seeing significant improvements, that the lockdown measures are working and that life may soon be able to at least start to return to normal. This is the moment investors have been waiting for, a time when they can start to put a date on normality and in some way quantify the damage.
"The US is facing a terrible couple of weeks which makes the rally on Wall Street all the more baffling. While I understand the market is trading at heavily discounted levels and the numbers of the last couple of days have maybe been better than some were expected, but analysing the day to day moves doesn't feel very productive, under the circumstances."
Covid-19 cases in the US have topped 347,000, with at least 10,000 deaths, according to Johns Hopkins University.
On the macro front, the number of job openings in the US fell to 6.9m in February, ahead of the 6.6m projected by economists, according to the Bureau of Labor Statistics.
Still to come, February consumer credit data will be published at 2000 BST.
Shares in cruise companies Carnival, Norwegian and Royal Caribbean were all up over 20%, while United Airlines shares flew 14% higher in early trade.
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