Stocks post modest gains at end of a wobbly day of trading

Major U.S. stock indexes finished higher Thursday after a late burst of buying led by technology and financial companies reversed an early slide.

News of a spike in the number of confirmed cases and fatalities from a virus outbreak in China put investors in a selling mood for most of the day, overshadowing a batch of mostly solid company earnings reports.

Traders have been worried that the outbreak could end up dampening global economic growth. But those concerns appeared to ease by late afternoon, after the director general of the World Health Organization said that the organization was not recommending limiting travel or trade to

China.

Technology and financial companies led the market’s rebound. Companies that rely on consumer spending also notched solid gains. Health care and communication stocks fell the most.

The S&P 500 index rose 10.26 points, or 0.3%, to 3,283.66. The index had been down 0.9% earlier in the day.

The Dow Jones Industrial Average climbed 124.99 points, or 0.4%, to 28,859.44. The Nasdaq added 23.77 points, or 0.3%, to 9,298.93.

Smaller company stocks recovered most of the way after taking the brunt of the selling. The Russell 2000 index slipped 1 point, or 0.1%, to 1,648.22.

Stocks have given up some ground after a strong start to the year amid uncertainty over the virus outbreak. Still, the major indexes remain on track to end January with gains.

The indexes spent much of Thursday in the red as investors assessed the latest company earnings reports and monitored developments in the outbreak of a new virus in China.

The new type of coronavirus is starting to spread to people outside China, which is essentially on lockdown. There are currently more than 7,800 confirmed cases, mostly in central China, and 170 deaths, mostly in Hubei province.

The WHO’s move to declare the outbreak a global emergency Thursday came after the number of cases spiked tenfold in a week. The declaration means the WHO sees the virus as a risk to other countries that requires an international response.

Companies have been issuing warnings over the potential impact to profits and revenue from the outbreak. Align Technology, which makes tooth-straightening systems, gave investors a weak profit forecast because of the virus. Starbucks has already held back on raising its forecast for the year and airlines are starting to curtail flights to Chinese cities because of weak demand.

Jitters over the virus outbreak had many investors initially seeking less risky assets Thursday. That drove up the prices of U.S. government bonds and gold. The yield on the 10-year Treasury note fell to 1.55% from 1.59% late Wednesday.

The price of gold climbed $13.10 to $1,583.50 per ounce. Gold prices are up 20% over the past year.

Investors bid up shares in companies reporting solid quarterly results.

Microsoft rose 2.8% after the software maker handily beat Wall Street’s fiscal second-quarter profit forecasts on its growing cloud computing business. The company said that revenue from its Azure cloud computing business grew 62% percent.

Tesla surged 10.3% after the electric vehicle maker blew past Wall Street’s fourth-quarter earnings forecasts on record sales. The company also told investors that it is ramping up production of the Model Y small SUV, which is a key product because consumers are buying smaller utility vehicles.

Benchmark crude oil fell $1.19 to settle at $52.14 a barrel. Brent crude oil, the international standard, dropped $1.52 to close at $58.29 a barrel. Wholesale gasoline fell 4 cents to $1.49 per gallon. Heating oil declined 6 cents to $1.64 per gallon. Natural gas fell 4 cents to $1.83 per 1,000 cubic feet.