S&P 500 Index: Opens higher on recovery hopes, despite coronavirus jitters

US stock markets open with modest gains after Tuesday's losses.
Optimism over a V-shaped economic recovery remained supportive.
Focus remains on developments surrounding the coronavirus saga.

Haresh Menghani FXStreet

Wall Street's main indexes open sharply higher on Wednesday and reversed a major part of the previous day's negative move. All three indices had registered heavy losses on Tuesday, snapping a five-day winning streak amid concerns about the ever-increasing coronavirus cases.

Meanwhile, hopes of a sharp V-shaped economic recovery continued underpinning the sentiment and remained supportive. The upbeat market mood got an additional boost after White House economic advisor Larry Kudlow repeated that the economy will not be shut down again.

This comes on the back of incoming positive economic releases, which offered evidence that the worse of the coronavirus pandemic was probably over and strengthened the case for a bounce-back in the economy. During the opening hour of trade, the S&P 500 was up 0.7%, while the Dow Jones Industrial Average and the Nasdaq Composite gained around 0.8% and 1%, respectively.

It will now be interesting to see if bulls are able to capitalize on the move up or once again opt to take profits at higher levels. Investors will continue to pay close attention to the number of new COVID-19 cases and the potential problems that could cause for economic recovery.

Author

Haresh Menghani

FXStreet

Haresh Menghani is a detail-oriented professional with 10+ years of extensive experience in analysing the global financial markets.

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