Biden’s Super Tuesday bounce back gives stock futures lift

Former Vice President Joe Biden, who just days ago was left for political roadkill, is bouncing back on Super Tuesday and giving stock futures a boost.

Biden captured wins in Texas, Massachusetts, Minnesota, Virginia, Tennessee, Alabama, North Carolina, Arkansas, and Oklahoma — a remarkable turnaround after his poor performances in Iowa, New Hampshire, and Nevada earlier this year. Sanders handily won his home state of Vermont and later racked up wins in California, Colorado and Utah.

Dow futures tacked on around 350 points with the S&P 500 and Nasdaq Composite rising in tandem as of 3:00 am. ET. The gains follow another volatile and down session for equities, which clipped 785 points off the Dow, or 3 percent, which mirrored the percentage losses for the S&P 500 and the Nasdaq after an emergency rate cut by the Federal Reserve failed to calm investor fears over the spreading coronavirus.

Also helping futures is the announcement from The World Bank that it is making $12 billion available to provide immediate support to low-income countries dealing with the health and economic impacts of the coronavirus.

World Bank President David Malpass said the money will go to help developing nations strengthen their health systems that are fighting an epidemic that has already spread to more than 60 countries.

In Asia, Japan’s Nikkei rose 0.1 percent, Hong Kong’s Hang Seng slipped 0.2 percent and China’s Shanghai Composite gained 0.6 percent.

In Europe, London’s FTSE gained 0.2 percent, Germany’s DAX slipped 0.1 percent and France’s CAC was off 0.1 percent.

EMERGENCY RATE BY FED AIMED AT CALMING CORONAVIRUS FEARS

Biden’s rebound now overshadows Sen. Bernie Sanders’ momentum, which had put the candidate with socialist policies on the road to the White House, in turn spooking Wall Street.

“We believe there are potentially far-reaching impacts for healthcare, technology and financials if risk premiums need to be reset for a higher probability of Sanders leading the party,” said Paul Christopher, head of global market strategy at Wells Fargo Investment Institute in a note released after Sanders’ Nevada and Iowa caucus wins.

While Super Tuesday results are still rolling in the final outcome is expected to narrow the 2020 field, which will provide a clearer picture for investors and should remove a layer of uncertainty that has been contributing to the recent equity selloff primarily driven by fears over the coronavirus.

US CORNAVIRUS DEATH TOLL RISING

The Wilshire 5000 Total Market Index, the broadest measure of U.S. equities, has lost $4.2 trillion since the Feb. 19 market high, as tracked by Dow Jones Market Data Group.

Year-to-date the Dow Jones Industrial Average has lost 9 percent, the S&P 500 7 percent and Nasdaq 3 percent.

By comparison, the 10-Year Treasury yield fell below 1 percent for the first time in history on Tuesday as investors sought out the safer assets.

Leave a Reply

Your compare list

Compare
REMOVE ALL
COMPARE
0

Shop By Category