US: Market rebounds along with oil prices, stimulus hopes

The US equity market finished higher for the first time in 3 days on Wednesday, 22 April 2020, as investors risk sentiments encouraged on crude prices stabilization after a record plunge and better than expected quarterly earnings reports. Meanwhile, approval of $484 billion coronavirus relief package by the Senate also lifted investor spirits. At closing bell, the Dow Jones Industrial Average advanced 456.94 points, or 2%, to 23,475.82. The S&P 500 - a gauge of US retirement and education savings accounts - gained 62.75 points, or 2.3%, to 2,799.31. The tech-heavy Nasdaq Composite Index climbed 232.15 points, or 2.7%, to 8,495.38.

Buying interest was generated in the US markets on substantial rebound in oil prices following the historic drop seen earlier this week. The front month crude oil contract turned negative for the first time in history on Monday, and later month futures showed another substantial move to the downside on Tuesday.

 

Also helping sentiment on Wednesday was approval of $484 billion coronavirus relief package that focused on small businesses, hospitals, and testing by Senate Republicans and Democrats on Tuesday. The bill will be voted on in the House of Representatives on Thursday. US legislators have already passed trillions of dollars in coronavirus relief measures.

All 11 U.S. stock market sectors were positive, led by energy, technology and utilities. Nearly all 30 Dow blue chips gained.

Energy stocks rose broadly amid crude oil prices surge. The West Texas Intermediate contract for June was up 19%, settling at $13.78 per barrel. Brent futures, meanwhile, were up 7.6% at $20.76 per barrel. Halliburton closed 10.3% higher. Diamondback Energy and Noble Energy both gained more than 7%.

Fast-casual chain Chipotle Mexican Grill Inc jumped 10.2% after it reported soaring digital and home delivery sales and said it had enough cash and liquidity to get through the next year.

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