The Dow snapped a three-day slump on Tuesday. The S&P 500 and the Nasdaq rose for the first session in five.
But investors shouldn't let down their guard just yet, warns Max Wolff of Multivariate. He doesn't think all the selling is done.
"We have a standard reality check scenario here. We should see another 10 to 15 percent S&P draw down and then a stabilization and maybe a small upward trend, that would be the best case scenario for the sort of vanishing of 2020. I will say this, markets tend to discount the future. I don't know a soul out there who excited to linger in 2020 for one millisecond longer than required. This hasn't been a great year on a lot of levels for a lot of folks, investor and economic and otherwise."
Investors did seem to take some comfort in comments by Federal Reserve Chairman Jerome Powell and Treasury Secretary Steven Mnuchin; both in Congressional testimony threw support behind another stimulus package. Mnuchin said any such aid should be targeted to small businesses and industries that remain under duress.
Amazon isn't one of those struggling companies. The stock was upgraded Tuesday by an analyst who predicts sales at the online behemoth will remain strong even after the health crisis subsides. The stock has surged 70 percent so far this year and kept going higher on Tuesday.
Another bright spot Tuesday: housing. Existing home sales surged to a near 14-year high in August. But future sales are at risk as the median price jumped to a record high of nearly $311,000.