The Nasdaq hit a record high on Tuesday and the S&P 500 headed for its best day in six months as fears of a heavy economic impact from the coronavirus epidemic tapered off after China's central bank intervened for the second straight day.

The Dow Industrials was on pace for its biggest daily percentage gain in eight months. The benchmark S&P 500 had more than made up for last week's 2% loss, which was its steepest weekly drop in six months.

China injected 1.7 trillion yuan ($242.74 billion) via reverse repos on Monday and Tuesday, helping Chinese stocks recover some losses and lifting the world equity index.

The stimulus boosted investor sentiment even as several economists cut forecasts for 2020 global growth as the fast-spreading virus hampers business operations in the world's second-largest economy.

"If China is doing what it needs to contain the worst-case scenario from a financial perspective, then maybe the weakness we saw last week was a little overdone," said Willie Delwiche, investment strategist at Baird.

Technology stocks, which are typically sensitive to growth-related concerns in China, led the charge with their 2.6% gain. The China-focused Philadelphia SE semiconductor index climbed 3.1%.

Alphabet Inc dropped 2.8% after Google's advertising business and new data about YouTube and Google Cloud broadly disappointed.

At 12:47 p.m. ET, the Dow Jones Industrial Average was up 469.46 points, or 1.65%, at 28,869.27, the S&P 500 was up 54.49 points, or 1.68%, at 3,303.41. The Nasdaq Composite was up 186.51 points, or 2.01%, at 9,459.92.

Adding to the optimism was data that showed new orders for US-made goods rose by the most in nearly one and a half years in December. It comes a day after a surprise rebound in factory activity in January.