Stocks jumped Thursday, erasing steep losses from earlier in the day as sharp gains in big-tech shares led to a sharp turnaround.
The Dow Jones Industrial Average traded 440 points higher, or 2.2%. The S&P 500 was up 2% while the Nasdaq Composite outperformed with a 4% surge. Shares of Netflix and Facebook rose 9% and 7.6%, respectively. Amazon gained 5.3%.
Earlier in the session, the Dow was down 721 points, or more than 3%. The S&P 500 briefly fell more than 3% as well.
“This is a day trader’s market,” said Christian Fromhertz, CEO of Tribeca Trade Group. “That’s not my favorite type of trading, but the day-to-day swings and the overnight moves are pretty insane.”
Among the industries trading in positive territory Thursday morning was energy, with the S&P sector up more than 0.5%. Big oil producers like Diamondback Energy and Apache rose more than 15% each as futures contracts tied to the price of West Texas Intermediate crude rallied more than 22% to $25.04 per barrel.
The moves followed yet another volatile day on Wall Street. The Dow dropped 1,338.46 points, or 6.3%, on Wednesday and clinched its first close below 20,000 since February 2017. The Dow was down more than 2,300 points at the lows of the session. The S&P 500 dropped 5.2% to 2,398.10 and closed nearly 30% below a record set last month as both indexes sank further into bear markets.
“Markets are clearly in a state of panic and forced liquidations — but risks remain skewed to the upside and this should become much more apparent once some of the solvency issues are addressed,” Adam Crisafulli, founder of Vital Knowledge, said in a note.
Wall Street has been on an unprecedented roller-coaster ride amid the coronavirus turmoil, with the S&P 500 swinging 4% or more in either direction for eight consecutive sessions.
An eye-watering spike in Treasury yields has also kept investors anxious. The 10-year Treasury rate hovered at 1.1% after jumping more than 50 basis points in two sessions as it rebounded from record lows.
Gregory Faranello, head of U.S. rates trading at AmeriVet Securities, said the swift reversal in yields stems from strong dollar demand amid the coronavirus crisis.
“There’s a dollar strain on the system, globally,” said Faranello. “Whether it’s Asia, Brazil, emerging markets, Europe or here in the U.S., the dollar is in demand right now.”
“If you look at everything across the board, it’s all going down together. The one thing that’s going up that’s dollar denominated is the U.S. dollar,” he added.
The dollar index, which tracks the greenback’s performance against a basket of other currencies, jumped Thursday to its highest level since January 2017. It last traded up 0.8% at 102 after breaking above 102.
More central bank stimulus
U.S. lawmakers appeared to inch closer to implementing fiscal stimulus measures. The Senate had enough votes to pass a bill expanding paid leave and unemployment benefits in response to the virus as part of what’s expected to be a whopping governmental response to avoid a downturn.
Senate Majority Leader Mitch McConnell said Wednesday he would vote for the plan despite what he called “real shortcomings.” With the urgent need to take action, “I do not believe we should let perfection be the enemy of something that will help even a subset of workers,” he said.
—CNBC’s Eustance Huang, Christine Wang and Michael Bloom contributed to this report.
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