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Dow ends 3.4% higher after latest US coronavirus updates

Wall Street stocks finished with solid gains Wednesday as the market embraced data from New York and other coronavirus hotspots that suggested the outbreak was leveling off.

The Dow Jones Industrial Average jumped 3.4 percent, or around 780 points, to 23,433.57.

The broad-based S&P 500 also gained 3.4 percent to 2,749.98, while the tech-rich Nasdaq Composite Index advanced 2.6 percent to 8,090.90.

Stocks were in positive territory all day, picking up momentum after New York Governor Andrew Cuomo said the state had suffered 779 fatalities over the last day, a new record, but that the hospitalization rate was continuing to decrease because of social confinement orders.

"We are flattening the curve," Cuomo told reporters.

The improved data from New York and some other hotspots has buoyed investment bulls who think the US economy may be able to ramp up before too long.

"The virus is either at its peak or very close to peaking, which raises hope that, by the end of May, we can start to get business activity going again," said Karl Haeling of LBBW.

But other commentators are far more skeptical, noting that the trajectory of the virus remains highly worrisome in other parts of the United States.

There is also uncertainty over how much longer social distancing measures will be needed, dimming the growth outlook and setting the stage for stocks to potentially retest the lows of a few weeks ago.

Oxford Economics has projected in its baseline forecast that the lockdown measures extend for six to 12 weeks, but released a note Wednesday that pointed to a possible "downside" scenario where lockdowns are prolonged into the third quarter, resulting in a global contraction of eight percent in that period.

"Investors appear to be 'looking beyond the valley,' even though the depth and length of this gorge continues to grow," said CFRA Research's Sam Stovall.

"Now that China is getting back to work, combined with an apparent cresting of NY COVID-19 caseloads and congressional conversations over additional stimulus packages, investors appear willing to reembrace equities. Yet history reminds us that a retest is still possible."