US Stock Market Overview – Stock Rally Led by Energy as Crude Oil Prices Bounce

US stocks moved higher on Tuesday rebounding slightly following Monday’s route. Stocks started the session at their peak, rising 950 points on the Dow Industrials, but volatility continued to generate whipsaw price action, which at one point wiped out all the gains. After a brief stint in the red, the Dow rebounding and continue to rally into the close, settling at the highs. New York took the first steps in shoring up its coronavirus defense. US Airlines told investors that they were cutting flights due to the declining demand for travel. Most sectors in the S&P 500 index were higher, led by a rebound in energy shares, Utilities bucked the trend. Congress is working on passing a bill that would be a coronavirus relief package. This would be very helpful to the hourly worker during a period of a few months if commerce is halt due to quarantines.

Price action remains volatile, and implied volatility remains elevated. Despite dropping 8% on Tuesday the VIX volatility index remains slightly below 50, which is near the highest close since 2008.

Crude oil prices rebounded sharply, following Monday’s collapse in oil prices. Prices hit a low just below $28 per barrel on Monday and rebounded to close up 11% above $34.50. Prices could test a gap in the price near $41 before finding a range that reflects the current market environment.

Coronavirus Spreads Into New York

New York State took the first steps to a coronavirus quarantine on Tuesday. Governor Andrew Cuomo said New York would establish a containment area in the town of New Rochelle in Westchester New York. The area would close facilities, including schools, within one mile of the center of the outbreak for two weeks, starting Thursday.

Airlines Trim Flights

Different US Airlines detailed the growing impact of the coronavirus by cutting more flights in domestic and international markets. American Airlines and Delta both said they planned to reduce the number of flights that fly for the foreseeable future.