Stock prices on Wall Street saw solid gains, providing additional momentum to Europe’s main markets
World stock markets rose on Wednesday, buoyed by investors’ hopes that the deadly new coronavirus will have only a short-term impact on corporate earnings and economic growth.
Stock prices on Wall Street saw solid gains across the board, providing additional momentum to gains already notched up by Europe’s main markets earlier in the session.
The broad-based S&P 500 gained 0.5 percent to close at a new record, as did the tech-rich Nasdaq.
London stocks were up by more than 1.0 percent at the close of trade, Frankfurt added 0.8 percent and Paris rose by 0.9 percent.
Investors were heartened by aggressive stimulus from Chinese authorities to support the economy, aided by strong US housing data, even as the death toll from the new coronavirus passed 2,100.
I don’t think the coronavirus is really important anymore. We are already seeing the new cases tail off. So probably the worst is over, said Maris Ogg of Tower Bridge Advisors. The effects will take some time to overcome, but the effects are not that important (in) the long-term overall.
Oanda Europe analyst, Craig Erlam, agreed. I guess the damage is less important than the knowledge that the central banks stand ready to throw money at the problem. In such an environment, it’s no wonder everything is a dip-buying opportunity.
The positive sentiment contrasted with the losses seen on Tuesday, when US and European indices had dropped after Apple warned it would miss its quarterly revenue forecast due to the epidemic.
Apple was among the star performers on Wednesday, gaining 1.5 percent to $323.62.
Electric automaker Tesla continued its upward march, rising by 6.9 percent.
Asian bourses also turned higher as investors bet on policymakers doing what is needed to minimize the fallout from the virus outbreak.
The illness, which has infected more than 74,000, has shut down manufacturing, disrupted supply chains and forced the cancellation of high-profile sporting and cultural events.
After four straight sessions in the red, Tokyo’s benchmark Nikkei 225 index closed up 0.9 percent.
Hong Kong won 0.5 percent but mainland China’s key Shanghai Composite Index sagged 0.3 percent.
The more sanguine mood came as Chinese officials released a study showing most patients have mild cases of the COVID-19 illness, and World Health Organization officials said the mortality rate was relatively low.
IMF chief Kristalina Georgieva warned the virus comes at a time when the global economy is fragile.
She warned that while the economic impact is likely to be small, “a long-lasting and more severe outbreak would result in a sharper and more protracted growth slowdown in China.”
World oil prices rebounded over hopes of solid energy demand in China.
The Asian powerhouse is the world’s biggest importer and consumer of oil — and prices have been particularly sensitive to the epidemic that has spread to nearly 30 countries and territories.
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