S&P 500, Dow flat after three-day rallyS&P 500, Dow flat after three-day rally
New York Stock Exchange opens during COVID-19

By Medha Singh and Devik Jain

(Reuters) – The S&P 500 and the Dow were largely flat on Wednesday as a record rise in coronavirus cases in six U.S. states dented sentiment following a three-day rally on hopes of a swift recovery from a coronavirus-driven downturn.

Arizona, Florida and Oklahoma were among the states that saw a record increase in new infections on Tuesday as businesses reopened. Beijing extended its movement curbs as it fought the worst resurgence of the disease since early February.

Cruise operator Norwegian Cruise Line Holdings Ltd tumbled about 6.7% as it extended the suspension of its voyages through September end due to the virus outbreak.

Peers Carnival Corp and Royal Caribbean Cruises Ltd also dropped 6.1% and 7.8% each.

The benchmark S&P 500 wrapped up its best three-day percentage rise in a month on Tuesday after a report on a massive fiscal stimulus plan and a stunning retail sales report for May reflected a pickup in demand as businesses reopened.

“The market got ahead of itself based on the Fed stimulus,” Matt Peden, chief investment officer at GuideStone Capital Management in Dallas said. “There could be further consolidation in the marketplace, that would be healthy, and would bring stocks closer to a more rational valuation level.”

Encouraging economic data and trillions of dollars in monetary and fiscal stimulus have propelled a rally in the Wall Street indexes from their late-March trough.

The S&P 500 is about 3% below its record closing high hit in February, while the tech-heavy Nasdaq was about 1% below its all-time closing high on June 10.

Federal Reserve Chair Jerome Powell warned on Tuesday that a full recovery is unlikely until the public is confident that the disease is under control, as he testified before U.S. lawmakers. The second day of his virtual hearing will begin at 12 p.m. ET (1400 GMT).

At 11:09 a.m. ET, the Dow Jones Industrial Average was down 25.50 points, or 0.10%, at 26,264.48, the S&P 500 was up 0.91 points, or 0.03%, at 3,125.65. The Nasdaq Composite was up 49.02 points, or 0.50%, at 9,944.88 with Apple Inc, Microsoft Corp and Amazon.com providing the biggest boost.

Energy and utilities led losses among the major S&P sectors.

Oracle Corp fell 4.2% after its quarterly revenue missed estimates as the pandemic led clients in the hospitality, retail and transportation sectors to postpone purchases.

Declining issues outnumbered advancers for a 1.47-to-1 ratio on the NYSE and a 1.33-to-1 ratio on the Nasdaq.

The S&P index recorded nine new 52-week highs and no new low, while the Nasdaq recorded 86 new highs and four new lows.

(Reporting by Devik Jain and Medha Singh in Bengaluru; Editing by Shounak Dasgupta)