(Reuters) - The S&P 500 and the Nasdaq scaled new highs on Wednesday, as an upbeat forecast from IBM added to optimism over earnings, while China’s efforts to contain a virus outbreak eased worries about a wider financial fallout.
International Business Machines Corp (IBM.N) shares jumped 4.1% after it forecast full-year profit above market expectations on strength in its high-margin cloud computing business.
Technology stocks .SPLRCT, which have played a main role in Wall Street’s recent record run, rose 0.8%.
Investors brushed aside fears from China’s new flu-like virus that has killed nine and infected 440 in the country after President Xi Jinping said curbing the outbreak and saving lives was a top priority.
The main indexes retreated from record highs on Tuesday after officials confirmed the first U.S. case of the coronavirus.
“While the death toll has risen to nine, it feels like affirmation we’re getting out of China is stemming fears that this is turning into an epidemic,” said Art Hogan, chief market strategist at National Securities in New York.
The outbreak, which revived fears of a pandemic similar to the Severe Acute Respiratory Syndrome (SARS) in 2003, roiled travel and airline stocks on Tuesday, as millions of people prepared to travel for the Chinese Lunar New Year.
Netflix Inc’s (NFLX.O) shares gave up gains to trade 3.1% lower after the streaming video pioneer beat estimates for quarterly subscription growth, but warned of a tough first quarter.
“Being in the fourth-quarter earnings season is going to be the tell. We’re going to find out if we’ve gotten ahead of ourselves or valuations are justified,” said
