Stocks end higher despite late burst of selling
Stocks closed broadly higher Tuesday on Wall Street as more countries relaxed restrictions on businesses, raising hopes for a recovery from the historic plunge that is sweeping the global economy.
The S&P 500 rose 0.9% after losing about half its early gains in a late-afternoon burst of selling. Technology and health care stocks accounted for much of the gains, which followed a strong showing in overseas markets.
Investors are increasingly cautiously optimistic that the gradual reopening of some businesses will begin to turn around the economy.
In California, some retail businesses could begin serving customers again as early as Friday, under some restrictions. Many European countries have also begun relaxing strict orders meant to slow the spread of the coronavirus outbreak, while waiting to see if it leads to a resurgence in infections. In Asia, the first pitches of the South Korean baseball season thwacked into catchers’ mitts, albeit in stadiums with no fans in attendance.
Expectations for stronger demand for oil as more businesses get the green light to open helped drive crude oil prices sharply higher, extending its mini-rally after falling to record lows last month.
“It’s investors getting a little bit ahead of themselves,” said Willie Delwiche, investment strategist at Baird. “Maybe, it’s a sense of relief that we’ve made it this far and there’s some sort of a path forward, even if it’s not real clear.”
Delwiche noted that questions remain about at what pace will consumers venture out of their homes and spend money as shuttered businesses reopen.
“That’s the big unknown right now,” he said.
The S&P 500 gained 25.70 points to 2,868.44. The Dow Jones Industrial Average rose 133.33 points, or 0.6%, to 23,883.09. The Nasdaq climbed 98.41 points, or 1.1%, to 8,809.12. Small stocks in the Russell 2000 index were doing even better than their larger rivals for much of the day, before shedding some of their gains by late afternoon. The Russell 2000 rose 9.54 points, or 0.8%, to 1,273.51.