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(Reuters) – Wall Street’s main indexes were set to open higher on Wednesday, building on their three-day rally as signs of more official stimulus supported hopes of an economic recovery, even as six U.S. states saw a record rise in new coronavirus cases.
FILE PHOTO: Traders exit the 11 Wall St. door of the New York Stock Exchange (NYSE) in New York City, New York, U.S., June 11, 2020. REUTERS/Brendan McDermid
The S&P 500 .SPX wrapped up its best three-day percentage rise in a month on Tuesday after a report on a massive fiscal stimulus plan, and a stunning retail sales report for May reflected a pickup in demand as businesses reopened.
Encouraging economic data and trillions of dollars in monetary and fiscal stimulus have propelled a rally in the Wall Street indexes from their late-March trough.
The benchmark S&P 500 and the Dow now remain about 8% and 11% below their respective record closing highs hit in February, while the tech-heavy Nasdaq hovered about 1% below its all-time closing high on June 10.
“Although question marks remain as to whether such a pace of recovery is sustainable given that the pandemic is unlikely to end anytime this year, the flood of stimulus is making it difficult for investors to ditch their optimistic views,” said Raffi Boyadjian, senior investment analyst at online broker XM.
Federal Reserve Chair Jerome Powell warned on Tuesday that a full recovery is unlikely until the public is confident that the disease in under control, as he testified before U.S. lawmakers. The second day of his virtual hearing will begin at 12 p.m. ET (1400 GMT).
Six U.S. states including Arizona, Florida and Oklahoma saw a record increase in new coronavirus infections on Tuesday as states pushed ahead with reopening. Beijing extended its movement curbs as it fought the worst resurgence of the disease since early February.
At 7:55 a.m. ET, Dow e-minis 1YMcv1 were up 179 points, or 0.68%. S&P 500 e-minis EScv1 were up 18.5 points, or 0.59% and Nasdaq 100 e-minis NQcv1 were up 59.25 points, or 0.59%.
Cruise operator Norwegian Cruise Line Holdings Ltd (NCLH.N) tumbled 7.7% in premarket trading as it extended the suspension of its voyages through September end due to the virus outbreak.
Oracle Corp (ORCL.N) fell 3% after its quarterly revenue missed estimates as the pandemic led clients in the hospitality, retail and transportation sectors to postpone purchases.
Southwest Airlines Co (LUV.N) edged higher as the carrier said it had enough cash to carry on business for the next two years, up from its prior forecast of 20 months, as travel demand gradually picks up.
Reporting by Devik Jain and Medha Singh in Bengaluru; Editing by Shounak Dasgupta
This article was first published at http://feeds.reuters.com/~r/reuters/businessNews/~3/WIBrDbRYWcs/wall-street-set-to-extend-three-day-rally-on-recovery-hopes-idUSKBN23O1LY