Topline: The stock market rallied on Wednesday after Senator Bernie Sanders (D-Vt.) dropped out of the presidential race—removing a key source of political unpredictability for Wall Street amid the ongoing economic uncertainty caused by the coronavirus pandemic.
- The Dow Jones industrial average was up 3.4%, almost 800 points, on Wednesday, while the S&P 500 rose 3.4% and the Nasdaq Composite gained 2.6%.
- Giving stocks an extra boost was Sanders’ announcement that he would be dropping out of the 2020 presidential race, since some of his progressive policy proposals, including Medicare-for-All, had sparked concern among business leaders on Wall Street.
- The market rally gained steam throughout the day, as investors also continue to focus on progress being made to contain the coronavirus pandemic and when the economy can eventually get back on track.
- Wall Street has cheered news that the number of new COVID-19 cases, both in the U.S. and globally, has started to slow since last Friday, according to data from Johns Hopkins University.
- Dr. Anthony Fauci, the White House’s top expert on infectious diseases, told Fox News on Wednesday that the number of deaths in the U.S. is lower than originally projected, saying that there should be a turnaround after this week.
Crucial statistic: The S&P 500 is now up more than 20% from its coronavirus sell-off low point in late March. Markets have steadily rebounded in recent weeks, taking solace in fiscal stimulus packages from the federal government and more recently, signs that coronavirus containment efforts are paying off.
Crucial quote: “The difference between now and the start of the pandemic is that we can at least see the end,” says Brad McMillan, chief investment officer for Commonwealth Financial Network. Stocks have subsequently gotten a boost, as investors are increasingly focusing on when the economy can recover: “We can see that we have flattened the curve.”
Big number: 25% of Americans have either lost their job or seen their wages slashed as a result of the coronavirus shutdown, according to CNBC’s All-America Economic Survey. The survey, which gauges the public’s view of the U.S. economy, posted the biggest and fastest decline in sentiment ever. On the flip side, however, some 51% of respondents said the economy will improve in 2021.
Key background: Stocks closed slightly negative on Tuesday, after a volatile session in which the major indexes pared back almost 4% of earlier gains. That followed a massive market rally on Monday, in which the Dow posted its third-biggest point gain ever. The Dow gained 7.8%, more than 1,600 points on Monday, while the S&P 500 jumped 7.2% and the Nasdaq rose 7.3%.
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