Call it the Biden bump. United States markets rose on news that US Senator Bernie Sanders dropped out of the presidential race, and coronavirus infections appear to be peaking. Now that Sanders is out, former US Vice President Joe Biden is now widely considered the man likely to face off against President Donald Trump.

The Dow Jones Industrial Average rose 3.44 percent, to 23,433.57. The S&P 500, which is a gauge for the performance of US retirement and college savings plans, gained 3.41 percent, to 2,749.98. The Nasdaq Composite Index added 2.58 percent, to close at 8,090.90.

Former Democratic presidential contender Bernie Sanders addresses his supporters via live stream from his home in Burlington, Vermont on Wednesday [Credit: Sanders' Campaign]

Sanders's dropout helped boost markets because many investors worried taxes would rise in a Sanders administration. Wall Steet considers Biden to be a more market-friendly candidate.

Hospitalisations for COVID-19, the respiratory disease caused by the new coronavirus, seemed to be leveling off in New York state, but deaths across the US jumped on Tuesday by a record of more than 1,800.

"Markets appear to be weighing the good with the bad," Mike Loewengart, managing director of investment strategy at E*TRADE Financial, told Bloomberg News. "In lieu of real-time economic data, we're seeing the markets latch onto signs of optimism around the pandemic."

Wuhan, the Chinese city where the new coronavirus emerged, ended its more-than-two-month lockdown on Wednesday. Still, new imported cases in the far northern province of Heilongjiang in China surged to a daily high of 25.

Investors edged out of US Treasuries, which have rallied to record-low yields over the last month. Benchmark 10-year notes last fell 5/32 in price to yield 0.75 percent, from 0.734 percent late on Tuesday.

"While the virus's curve is flattening, the economic effects of the corona crisis will linger for years in our view," Commonwealth Bank of Australia economist Joseph Capurso said in a note.

"Economies will take time to re-open, some businesses will not re-open, and unemployment will take years to return to levels reported at the end of 2019."

Oil prices rose ahead of a meeting on Thursday between OPEC members and allied producers. Traders hope the meeting could lead to output cuts to shore up prices.

Brent crude - the global benchmark- added 5.6 percent to $33.2567 per barrel after falling 3.6 percent on Tuesday. US West Texas Intermediate (WTI) crude rose 9.9 percent to $25.98 a barrel.