New York (AFP) - Wall Street stocks finished a roller-coaster session sharply higher Tuesday as oil prices bounced while the Trump administration continued to promise relief measures to offset the economic hit from coronavirus.
The day after suffering its worst session in more than 11 years, the Dow piled on more than 1,150 points, or nearly five percent, to finish at 25,018.16.
Elsewhere, Brazil's Ibovespa index also enjoyed a good bounce back, while European bourses endured another losing session.
Analysts warned of more volatility ahead amid uncertainty of how much the virus will spread in the United States, the extent it further dampens activity in the world's biggest economy and the robustness of the US policy response.
"It's like winding up a rubber band. The more you wind it, when you let go, the more it pops," LBBW's Karl Haeling said of Tuesday's jump amid heightened volatility.
"A lot of the uncertainty goes to the root of the virus itself."
The virus has reached more than 117,000 people and caused more than 4,200 deaths, with the most severe impacts thus far on China and Italy, which was on lockdown following an announcement by the Italian government late Monday.
Shares in Milan ended 3.3 percent lower, despite Italy airing plans to allow families to suspend mortgage and some tax payments and seek permission from Brussels to boost exceptional spending beyond the 7.5 billion euros ($8.5 billion) planned to help businesses hurt by a sharp drop in tourism over the past month.
How bad in US?
The hit in the United States thus far has included the cancelation of events such as the South by Southwest festival in Austin and BNP Paribas tennis tournament in California. On Tuesday, the New York International Auto Show was rescheduled to late August from April due to virus fears.
"The assumption is that it's certainly going to hit the US economy, but how much is unknown," said Briefing.com analyst Patrick O'Hare.
"You don't know how extensive the nesting effect will be" in the US, he added.
O'Hare said the cancelations in the US dent revenues for airlines, hotels and other industries that rely on large events, while analysts expect a hit to employment and spending tied to the petroleum sector in light of crashing oil prices.
US President Donald Trump said in a midday appearance at the White House that he plans to provide assistance to airlines and cruise companies, two especially hard-hit industries, boosting equities in both those sectors.
There were also reports in US media that Trump is considering freezing payroll taxes on workers and offering some form of relief to US shale producers, which face significant challenges after a brutal drop in oil prices.
Analysts said Tuesday's rally was not surprising given market weakness over the last few weeks, especially Monday's rout.
They also pointed to strengthened investor sentiment following a significant jump in oil prices and a bounce in US Treasury yields from all-time lows.
The rise in oil prices came as Russian Energy Minister Alexander Novak told state-run Rossiya 24 television channel that Moscow remains open to cooperation with Saudi Arabia and the rest of OPEC to stabilize the oil market, saying "I want to say the doors aren't closed."
The remarks came a day after oil prices suffered the biggest single-day drop since 1991 as Saudi Arabia cut crude prices, sparking fears of a war for market share with potentially devastating effects on smaller US producers.
Key figures around 2050 GMT
New York - Dow: UP 4.9 percent at 25,018.16 (close)
New York - S&P 500: UP 4.9 percent at 2,882.23 (close)
New York - Nasdaq: UP 5.0 percent at 8,344.25 (close)
London - FTSE 100: DOWN less than 0.1 percent at 5,960.23 (close)
Frankfurt - DAX 30: DOWN 1.4 percent at 10,475.49 (close)
Paris - CAC 40: DOWN 1.5 percent at 4,636.61 (close)
Milan - FTSE MIB: 3.3 percent at 17,870.18 (close)
EURO STOXX 50: DOWN 1.7 percent at 2,910.02 (close)
Tokyo - Nikkei 225: UP 0.9 percent at 19,867.12 (close)
Hong Kong - Hang Seng: UP 1.4 percent at 25,392.51 (close)
Shanghai - Composite: UP 1.8 percent at 2,996.76 (close)
West Texas Intermediate: UP 10.4 percent at $34.36 per barrel
Brent North Sea crude: UP 8.3 percent at $37.22 per barrel
Dollar/yen: UP at 105.55 yen from 102.36 yen at 2100 GMT
Euro/dollar: DOWN at $1.1285 from $1.1450
Pound/dollar: DOWN at $1.2898 from $1.3117
Euro/pound: UP at 87.49 pence from 87.27 pence