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Stocks Rally, Bond Decline on Easing Virus Toll: Markets Wrap

Stocks surged the most in more than a week after the reported death tolls in some of the world’s coronavirus hot spots showed signs of easing. The yen weakened and Treasuries fell.
Bloomberg
By Bloomberg
6 Apr
New York Stock Exchange coronavirus reaction epa08310684 A man sweeps the floor of the New York Stock Exchange after the closing bell in New York, New York, USA, on 20 March 2020. The New York Stock Exchange will temporarily stop floor operations at the end of the day after two people who work in the building were tested positive for the coronavirus. The market will still be open, but there will be no in-person trading on the floor. EPA-EFE/JUSTIN LANE

The benchmark S&P 500 Index jumped as much as 5.9% after New York Governor Andrew Cuomo said the virus-related death rate was effectively flat for two days. Italy reported the lowest number of new coronavirus infections in nearly three weeks, 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.

Major U.S. equity benchmarks remain ravaged by coronavirus outbreak

The upbeat tone in markets follows 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.

Read more
U.K.’s Boris Johnson Staying in Hospital for ‘Observation’
Germany, Spain Cases Slow; Dimon Sees Recession: Virus Update
Death Toll, Ailing Economy Fail to Unite Congress on Next Steps

These are the some of the main moves in markets:

Stocks

  • The S&P 500 Index climbed 5.3% to 2,621 as of 2:23 p.m. New York time, the highest in more than three weeks on the largest increase in more than a week.
  • The Dow Jones Industrial Average climbed 5.9% to 22,304.70, the highest in a week on the biggest increase in more than a week.
  • The Nasdaq Composite Index surged 5.8% to 7,803.59, the highest in more than three weeks on the largest jump in almost two weeks.
  • The MSCI All-Country World Index surged 4.9% to 446.09, the highest in more than a week on the biggest jump in almost two weeks.

Currencies

  • The Bloomberg Dollar Spot Index fell 0.2% to 1,266.05, the largest fall in more than a week.
  • The Japanese yen depreciated 0.4% to 109.03 per dollar, the weakest in more than a week.
  • The euro was little changed at $1.0802, the first advance in more than a week.
  • The British pound gained 0.4% to $1.2312, the biggest advance in more than a week.

Bonds

  • The yield on two-year Treasuries jumped three basis points to 0.26%, the highest in more than a week on the largest surge in almost two weeks.
  • The yield on 10-year Treasuries jumped seven basis points to 0.67%, the biggest surge in almost three weeks.
  • Germany’s 10-year yield climbed two basis points to -0.43%, the highest in more than a week.
  • Britain’s 10-year yield jumped two basis points to 0.334%, the biggest surge in almost two weeks.

Commodities

  • Gold strengthened 2.2% to $1,655.66 an ounce, the highest in four weeks on the largest jump in almost two weeks.

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