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Published: April 8, 2020 at 4:50 p.m. ET, By Mark DeCambre and Joy Wiltermuth<\/p>\n
U.S. stocks finished sharply higher Wednesday as investors hoped for more Federal Reserve support and a potential sooner-than-expected rollback of containment measures put in place to fight the COVID-19 pandemic.<\/p>\n
Bernie Sanders also ended his race for the White House, removing market uncertainty around his campaign promises to rein in Wall Street and big corporations as president.<\/p>\n
How did indexes perform?<\/strong><\/p>\n The Dow Jones Industrial Average US:DJIA rose 779.71 points, or 3.4%, to finish at 23,433.57. The S&P 500 index US:SPX added 90.57 points, or 3.4%, to end at 2,749.98, and the Nasdaq Composite Index US:COMP climbed 203.64 points, or 2.6%, to close at 8,090.90.<\/p>\n On Tuesday, the blue-chip Dow US:DJIA lost 26.13 points, or 0.1%, to finish at 22,653.86, the S&P 500 index US:SPX shed 4.27 points, or 0.2%, to end at 2,659.41, and the Nasdaq Composite Index US:COMP fell 25.98 points, or 0.3%, closing at 7,887.26.<\/p>\n The Dow is now 20.7% off its record close in February, while the S&P 500 is off 18.8% and the Nasdaq off 17.6%, according to Dow Jones Market Data.<\/p>\n What drove the market?<\/strong><\/p>\n The White House\u2019s plans for reopening the U.S. economy<\/a> and an account of the Federal Reserve\u2019s emergency actions taken last month were points of focus for investors.<\/p>\n Minutes for the central bank\u2019s March 15 policy meeting showed that staffers viewed no major economic recovery until next year<\/a> as a worst-case scenario of the coronavirus outbreak, according to minutes released Wednesday. Fed staffers also fretted about a lack of future ammunition<\/a> to combat economic distress after the central bank took unprecedented monetary-policy actions last month and slashed rates to a range of 0% to 0.25%.<\/p>\n Following the minutes\u2019 release, Bob Miller, head of Americas fundamental fixed-income at BlackRock, estimated that the Fed\u2019s \u201cdo-whatever-it-takes attitude\u201d could swell the central bank\u2019s balance sheet to $10 trillion in the coming year, as the Fed looks to forge a pathway to recovery.<\/p>\n Stocks also rose after Sanders exited the U.S. presidential race<\/a> on Wednesday, opening the way for Joe Biden to become the Democratic nominee. Sanders\u2019 candidacy has kept investors on edge over the past few months over concerns that his hostility to corporations and plans for universal health coverage could lead to increased regulatory costs and lower earnings growth.<\/p>\n \u201cOn the margin, having no longer any possibility of a progressive in the White House, that\u2019s helped,\u201d said Tony Roth, chief investment officer at Wilmington Trust, in an interview with MarketWatch.<\/p>\n This comes as Trump administration officials have expressed a desire to begin to reopen parts of the economy that have been shut to help limit the spread of the viral contagion that has ravaged the globe. When and what form that process takes place may be key to helping investors anticipate the economic rebound ahead.<\/p>\n \u201cThis week, we\u2019re starting to see folks shift to being more hopeful that maybe the social distancing measures can be relieved sooner rather than later,\u201d said Michael Arone, chief investment strategist at State Street Global Advisors, in an interview.<\/p>\n But Dr. Anthony Fauci, the expert in infectious diseases and face of the response to COVID-19 on President Donald Trump\u2019s pandemic task force, said a path isn\u2019t clear. \u201cIt isn\u2019t like a light switch on and off,\u201d he said in a podcast interview with the Wall Street Journal<\/a> that aired on Tuesday.<\/p>\n The total death toll in the U.S. from the pandemic rose sharply to more than 12,900, according to data compiled by Johns Hopkins University<\/a>. Confirmed infections in the U.S. neared 400,000, more than double the number of any other nation. Cases globally rose to more than 1.4 million, while deaths exceeded 85,000.<\/p>\n In New York, Gov. Andrew Cuomo said the number of deaths exceeded 6,200<\/a> and warned that fatalities will continue to rise as more patients lose their battle with the virus. \u201cThe bad news isn\u2019t just bad. The bad news is terrible,\u201d Cuomo said in his daily news briefing.<\/p>\n Pimco\u2019s U.S. economist Tiffany Wilding warned that of the value of U.S. goods and services could plunge to negative 30% in the second quarter, while unemployment could temporarily top 20% due to the pandemic.<\/p>\n \u201cUltimately, we think the government and the central bank will do whatever it takes to limit the longer-term damage to the U.S. economy, and that the virus outbreak will eventually subside,\u201d Wilding wrote in a blog post Wednesday<\/a>. \u201cHowever, in the meantime there will be some business bankruptcies and lost GDP.\u201d<\/p>\n