(Reuters) – Wall Street’s main indexes hit record highs on Wednesday on optimism that the coronavirus epidemic will be contained and as Bernie Sanders cemented his front-runner status in the race of the Democratic nomination.
China reported its lowest number of new coronavirus cases in two weeks, bolstering a forecast by Beijing’s senior medical adviser for the outbreak in the country to end by April.
However, it was still unclear to what extent economic growth would take a hit from the virus that has killed more than 1,100 people and shuttered businesses in China.
“There’s optimism that coronavirus cases have started to slowdown,” said Gene Goldman, chief investment officer at Cetera Investment Management, but added that “markets have not really factored in the effects of coronavirus on the Chinese economy.”
All major S&P sectors were higher and technology stocks .SPLRCT, which have surged 10% so far this year, continued to dominate with a 0.7% rise.
Meanwhile, some investors speculated that Sanders’ lead in the race of the Democratic nomination for the 2020 presidential election after his narrow win in New Hampshire increased the chances of President Donald Trump staying in office.
“Markets are operating under the presumption that if Bernie Sanders does get the nomination, he will not be able to win in a general campaign…,” said Danielle DiMartino Booth, chief strategist of boutique research firm, Quill Intelligence.
“That would mean four more years of policies that have been met with such friendliness by the financial markets.”
Health insurers UnitedHealth Group Inc (UNH.N), Centene Corp (CNC.N), Humana Inc (HUM.N) and Anthem Inc (ANTM.N) gained between 2.8% and 3.8% and analysts pointed the share move to a smaller-than-expected margin win for Sanders, who supports elimination of private health insurance.
At 1:22 p.m. ET, the Dow Jones Industrial Average .DJI rose 0.62% to 29,456.86 and the S&P 500 .SPX gained 0.41% to 3,371.62. The Nasdaq Composite .IXIC was up 0.70% at 9,706.71.
The benchmark S&P 500 has risen nearly 5% from its late January lows as largely positive fourth-quarter earnings and encouraging U.S. economic data helped investors look past coronavirus worries.
Lyft Inc (LYFT.O) slid 9.3% as the ride-hailing company forecast slower revenue growth for the year.
Micron Technology Inc (MU.O) climbed 4.6% after UBS upgraded the chipmaker’s shares to “buy”.
Advancing issues outnumbered decliners by a 1.75-to-1 ratio on the NYSE and by a 1.59-to-1 ratio on the Nasdaq.
The S&P index recorded 63 new 52-week highs and two new lows, while the Nasdaq recorded 121 new highs and 36 new lows.
Reporting by Medha Singh and Sruthi Sankar in Bengaluru; Editing by Maju Samuel and Anil D’Silva