Stocks, oil rebound after plunging

US stocks rebounded Tuesday after posting the sharpest decline Monday since the 2008 global financial crisis.

Oil, a proxy for future economic activity, made a comeback and the yield on the benchmark 10-year US Treasury note edged up, suggesting the flight to safe assets amid the stock market rout may be easing.

The Dow Jones Industrial Average rose 843 points, or 3.5 percent, on the opening to 25,695 and then edged lower. The S&P 500, a broader index of stock performance, opened rose about 3.4 percent and remained in the green in early trading. The Nasdaq Composite opened strongly, adding about 3.4 percent and, despite a few dips in early trading, remained in positive territory.

Investors are concerned about a possible worldwide economic slowdown due to the spread of the coronavirus, also called Covid-19. Production has been disrupted in China, but appears to be resuming. That will ease concerns about disruption to the supply chain in numerous sectors, including electronics, car parts and apparel.

In a research report, New York investment bank Goldman Sachs said, "Our baseline assumption is the Covid-19 virus becomes widespread but is relatively short-lived. We forecast flat earnings in 2020 followed by 6% growth in 2021. However, the US economy could slip into a recession if the coronavirus contagion lasts for an extended period of time."

Flat earnings makes stocks too expensive and many investors sell. If growth returns in 2021, stocks will rebound.

Saudi Arabia and Russia are engaged in a price way to grab market share. Both countries say they're willing to pump more crude, and that could create a worldwide glut of oil, driving prices down. Lower prices could threaten US frackers who have freed the nation of its dependence on Middle East oil.

Brent crude, the global benchmark, rose about 9 percent to $37.35 a barrel, but that's well below the $52-a barrel level it traded at earlier this month.

White House officials plan to meet with members of Congress to discuss possible measures to ease the expected shock to the economy from the coronavirus, including a payroll tax cut and help for hourly wage earners.

It's unclear if such measures will be enough to calm the market's long-term fears, especially after the Dow shed more than 2,000 point Monday. But for now, all indexes are up.