The former vice president captured nine states, including Texas, a projection that propelled him to the front of the race. Sanders could still score the biggest prize of the evening, California, where he leads.
“Bernie Sanders’ socialist agenda includes many proposals to raise taxes and regulations, which would weigh on the economy and corporate profits,” said Ed Yardeni, president of Yardeni Research. “The sale of the market last week on the main victories for Sanders and its rebound on Monday after Biden’s big victory in South Carolina and this morning after Super Tuesday suggest that American domestic policy could be as important as the crisis global healthcare for investors. “
By mid-afternoon, the Dow Jones industrial average was up 3.2%. The Standard & Poor’s 500 Index rose 2.9% and the tech-rich Nasdaq rose 2.75%.
Health care stocks soared in response to Biden’s performance. Cigna increased by more than 10% in morning trade, while UnitedHealth Group increased by almost 12%. Humana jumped 1.25% and Anthem climbed almost 14%.
“The boost from the big Fed rate cut and Biden’s victory last night has put a floor under the stock market for now, so investors breathe a huge sigh of relief and short sellers come out of the scene left, “Chris Rupkey, chief financial economist at MUFG Union Bank, wrote in a comment Wednesday. “The liquidation of the coronavirus market seems to be stabilizing.”
On Wednesday, the International Monetary Fund announced that it was offering emergency funding of $ 50 billion to fight coronavirus for low-income countries and emerging markets. IMF Managing Director Kristalina Georgieva said the epidemic was a global problem “calling for a global response”.
The World Health Organization said on Tuesday that covid-19, the disease caused by the virus, had killed about 3.4% of those diagnosed with the disease – a higher rate than previously estimated. On Wednesday, the number of new coronavirus deaths reported outside of China exceeded those reported inside the country – the center of the epidemic – for the first time.
The markets were also shaken as the yield on 10-year Treasury bills dropped to an all-time low on Tuesday. Bonds are a safe haven for investors in turbulent times, and bond yields decline as bond prices rise. Gold, another safe haven, rose 2.9% on Tuesday and continued to rise, now trading at $ 1,647 an ounce.
“The 10-year Treasury is a great barometer for measuring fear,” Wayne Wicker, chief investment officer at Vantagepoint Investment Advisers, wrote on Wednesday. “With Tuesday’s closing yield at a record level of less than 1%, the markets reflect increased uncertainty linked to the coronavirus and the macroeconomic implications.”
European markets reflected US optimism on Wednesday, with the Stoxx 600 benchmark, the German DAX and the French CAC 40 both up over 1.4% in midday trading. The British FTSE 100 climbed 1.6%. The Asian markets closed with mixed results, with the Hang Seng in Hong Kong down 0.25% and the Nikkei 225 in Japan weakly positive.
Panic over the presence of the coronavirus in the United States increased as the death toll rose to nine, and new research found that the virus had probably spread undetected in California and Washington for weeks. Americans are starting to face disruptions in their work and travel, and the list of major events canceled in the face of the epidemic is growing hour by hour. Many grocery stores and pharmacies claim to be rid of bottled water, disinfectants, and frozen and long-life foods.
Investors are eagerly awaiting ADP payroll figures and new manufacturing data on Tuesday to further analyze the damage the coronavirus has caused to the global economy. Analysts expect global economic growth to slow to its lowest level since the financial crisis this quarter.
