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Wall Street set to open higher on hopes U.S. outbreak nearing peak

FILE PHOTO: The Wall Street sign is pictured at the New York Stock exchange (NYSE) in the Manhattan borough of New York City, New York, U.S., March 9, 2020. (REUTERS/Carlo Allegri)

BY UDAY SAMPATH KUMAR

Wall Street was set to open higher on Wednesday on hopes that the coronavirus outbreak in the United States was nearing its peak and expectations Congress will push through hundreds of billions more in emergency support for the battered economy.

Stock index futures moved between gains and losses in early trading, continuing the volatility from the closing stages of Tuesday’s session, when a tumble in oil prices wiped out early gains in a market closely tracking the latest on layoffs, cutbacks and losses.

President Donald Trump said late on Tuesday that the United States might be getting to the top of the “curve” of the outbreak, even as New York and several other states posted their highest number of daily virus-related fatalities.

“Traders are trying to pick a bottom in shares and scientists are trying to pick the peak in the pandemic. Both exercises typically result in a lot of false starts before the real thing,” Jasper Lawler, head of research at London Capital Group said.

Sentiment also got a lift as Democratic leaders in Congress threw their support behind interim emergency funding, a day after the Trump administration asked lawmakers for $250 billion in aid for small businesses hit by the pandemic.

The package would add to the $2.3 trillion in stimulus already approved and meant to make up for the wages and incomes lost after Americans were ordered to stay home to control the spread of the virus.

Those measures have brought the economy to a virtual halt, with the benchmark S&P 500 <.SPX> down nearly 22%, or about $6 trillion in market value, from its record high in mid-February, despite the recent gains.

Tesla Inc <TSLA.O> on Tuesday became the latest U.S. company to furlough staff and cut salaries during a shut down of its U.S. production facilities. The electric-car maker’s shares rose nearly 2% in premarket trading.

Corporate earnings season starts next week with earnings from Wall Street banks, and companies are expected to outline drastic measures as they look to bolster dwindling cash reserves.

At 08:36 a.m. EDT, Dow e-minis <1YMcv1> were up 230 points, or 1.02%, S&P 500 e-minis <EScv1> were up 27.75 points, or 1.05% and Nasdaq 100 e-minis <NQcv1> were up 93.25 points, or 1.16%.

Shares of UPS <UPS.N> and FedEx <FDX.N> rose up 4.6% to 6.5% after Amazon.com Inc <AMZN.O> said it would suspend its U.S. shipping service.

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