The Dow Jones returned to 27,000 points thanks to a 4.53% jump.
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Wall Street finished sharply higher on Wednesday, enthusiastically welcoming Joe Biden’s return to the ranks of favorite among the Democratic primaries while keeping an eye on the new coronavirus.
Its flagship index, the Dow Jones Industrial Average, climbed 4.53% to 27,090.86 points while the highly technological Nasdaq gained 3.85% to 9,018.09 points.
The S&P 500, which represents the 500 largest companies on Wall Street took 4.22% to 3,130.12 points.
This energetic rebound was led by the surge in the shares of insurers United Health (+ 10.74%), Centene (+ 15.73%), Humana (+ 14.44%) and Cigna (+ 10.52%) .
Former US Vice President Joe Biden took the lead in the race for the Democratic primaries after a “Super Tuesday” full of surprises where he won Tuesday at least nine of the 14 states at stake on this day decisive election.
While the victory in the Democratic primary of its competitor Bernie Sanders, a claimed socialist and favorable to the establishment of a large public health care system, now appears less likely, the sub-index representing the health sector has jumped by 5.81% Wednesday.
“Mr. Sanders’ victory would be seen as an increased risk to health insurers because he offers a broad, free national health insurance program for all Americans, which could lead to the elimination of the existing system,” said Sel Hardy, analyst at CFRA.
Biden, for his part, “proposes a more moderate change to the private insurance system,” added the specialist.
Major Wall Street indices also benefited from “a rebound after the sharp drop triggered (Tuesday) by the surprise cut in Fed rates by half a percentage point,” analysts at Charles Schwab note.
The New York Stock Exchange was shaken Tuesday by the rate cut decided urgently by the American Central Bank (Fed) to mitigate the economic impact of the coronavirus. Welcomed with great skepticism by investors, the announcement had dropped the Dow Jones by almost 3%.
The fact that Fed officials decided to take a drastic step outside of the usual monetary meeting schedule, a first since the 2008 financial crisis, had more alarmed than reassured Wall Street brokers on Tuesday.
On Wednesday, new institutions came to the table to lend their support, like the Bank of Canada which lowered its rates for the first time since 2015 by invoking the “substantial negative shock” of the new coronavirus on Canadian economic prospects and global.
The boss of the International Monetary Fund (IMF) said that the institution had available $ 10 billion which can be lent at zero rate, especially to the most fragile countries.
The US Congress has also agreed to additional funding of $ 8.3 billion to fight the epidemic.
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