(Reuters) – Healthcare stocks boosted Wall Street on Wednesday after a near sweep for Joe Biden in the Super Tuesday Democratic primaries, a day after markets suffered heavy losses following an emergency interest rate cut by the Federal Reserve.
The benchmark S&P 500 .SPX rose for the second time in 10 sessions, bolstered by Biden’s return to front-runner status in the U.S. Democratic presidential nomination campaign over self-declared socialist Bernie Sanders.
“The markets will see Biden’s success as helping to eliminate what they see as the worst option, a Sanders presidency,” said Chris Nixon Cox, Chief Global Strategist at BrightSphere Investment Group.
Shares of health insurers UnitedHealth Group Inc (UNH.N), Centene Corp (CNC.N), Humana Inc (HUM.N) and Cigna Corp (CI.N) surged between 9.8% and 13.4%. The broader healthcare .SPXHC index jumped 3.2%, the most among all the major S&P sectors trading higher.
The healthcare sector had suffered in recent months as Sanders and his “Medicare for All” proposal, which would eliminate private health insurance altogether, gained prominence.
The three indexes dropped nearly 3% on Tuesday as an emergency interest rate cut by the Federal Reserve amplified fears about the extent of the economic damage from the coronavirus outbreak.
Fears of a global slide into recession, and a resulting collapse in U.S. corporate earnings this year, have knocked $3.1 trillion off the value of major U.S. companies in the past 10 days.
At 9:54 a.m. ET, the Dow Jones Industrial Average .DJI was up 445.37 points, or 1.72%, at 26,362.78, the S&P 500 .SPX was up 37.97 points, or 1.26%, at 3,041.34. The Nasdaq Composite .IXIC was up 88.84 points, or 1.02%, at 8,772.93.
Adding to the upbeat mood, the ADP National Employment Report showed U.S. private payrolls rose more than expected in February. The data is considered a precursor to the more comprehensive jobs report on Friday.
All eyes will also be on the Fed’s beige book report, which will offer the first snapshot from the central bank’s business contacts on how deeply the coronavirus is impacting the domestic economy.
U.S. food company Campbell Soup Co (CPB.N) rose 5.9% after lifting its 2020 profit forecast, and topping analyst estimates for the quarter on improved demand for its soups.
Upscale retailer Nordstrom (JWN.N) slid 4.5% after forecasting a 2020 profit largely below market expectations.
Advancing issues outnumbered decliners by a 4.39-to-1 ratio on the NYSE and a 2.88-to-1 ratio on the Nasdaq.
The S&P 500 recorded two new 52-week highs and 13 new lows, while the Nasdaq recorded 14 new highs and 35 new lows.