Feb 11 (Reuters) – The S&P 500 and the Nasdaq indexes scaled new highs on Tuesday as investors took heart from remarks by a top Chinese health adviser that the coronavirus outbreak may be peaking.
After more than 1,000 deaths and weeks of uncertainty that roiled global financial markets, China’s foremost medical adviser on the epidemic said infections may be over by April.
However, the hit to the world’s second-largest economy was still unclear as companies struggled to get back to work after an extended holiday.
“The consensus seems to be that we are seeing the worst of the coronavirus impact right now but from here it is going to get better,” said John Zaller, chief investment officer of MAI Capital Management in Cleveland.
“Unless that changes, the markets will still be okay with a short-term blip in terms of economic and earnings growth.”
The main U.S. stock indexes have reclaimed record highs as a batch of encouraging domestic economic data, largely upbeat corporate earnings and recent stimulus measures from China helped investors look past fears about the coronavirus.
Federal Reserve Chair Jerome Powell told Congress that the U.S. economy is in a good place, even as he cited the potential threat from the epidemic in China.
The communication services index was among the only two major S&P sectors in the red. Cyclical sectors such as technology and consumer discretionary provided the biggest boosts to the benchmark index.
At 12:50 p.m. ET, the Dow Jones Industrial Average edged 0.07% higher to 29,297.38.
The S&P 500 rose 0.39% at 3,365.17 and the Nasdaq Composite was up 0.54% at 9,680.57.
T-Mobile shares jumped 11.2% to the top of the benchmark S&P 500 after a federal judge approved its purchase of Sprint, clearing the path for a deal which was originally valued at $26 billion.
Sprint surged 72.3%, while larger rival Verizon Communications Inc slipped 2.3%.
Cell tower operators, including SBA Communications Corp , American Tower Corp and Crown Castle International Corp, jumped between 4% and 8.1% on expectation that the merger will result in additional cell-tower sites.
Under Armour Inc tumbled 16.2% after it forecast a surprise drop in 2020 profit.
Advancing issues outnumbered decliners by a 2.76-to-1 ratio on the NYSE and by a 2.07-to-1 ratio on the Nasdaq.
The S&P index recorded 77 new 52-week highs and two new lows, while the Nasdaq recorded 141 new highs and 51 new lows.