US open: Stocks rally following sharp sell-off

Wall Street stocks opened sharply higher on Wednesday, putting a halt to a sell-off started late last week that ended with the Nasdaq entering correction territory.

As of 1530 BST, the Dow Jones Industrial Average was up 1.69% at 27,966.00, while the S&P 500 was 1.92% firmer at 3,395.69 and the Nasdaq Composite started out the session 2.14% stronger at 11,080.18.

The Dow opened 465.11 points higher on Wednesday, a marked turnaround from the beating taken by major indices in the previous session as stocks put on their worst performance since March.

Wednesday's positive moves came despite news that AstraZeneca's late-stage trial of its Covid-19 vaccine candidate had been paused as a result of a suspected serious adverse reaction in a participant.

Also in focus, Democratic presidential candidate Joe Biden proposed a new offshoring penalty that would lead to a 28% corporate tax rate, plus a 10% "offshoring penalty surtax" on profits made by a US company overseas for sales back to the US. He also called for a 10% tax credit for companies that make investments that create jobs for American workers and a 21% minimum tax on all foreign earnings.

On the macro front, mortgage applications rose 2.9% in the week ended 4 September, according to the Mortgage Bankers Association, the first rise in almost a month. The refinance index also ticked up 3% and homebuyer mortgage applications went up 2.6%.

Elsewhere, the number of job openings across the US increased 4.5% to 6.6m as of 31 July, according to the Bureau of Labor Statistics, but new hires decreased 4.1% to 5.8m despite a resumption of economic activity following Covid-19-related shutdown efforts aimed at containing the coronavirus.

In corporate news, Tiffany shares slumped at the bell after Louis Vuitton parent LVMH announced that it would not complete its takeover of the jeweller, while UPS shares were higher after announcing that it would hire 100,000 seasonal employees in the lead up to Christmas.

Walmart shares also advanced in early trade after revealing it would test a drone-based delivery programme.