{"id":2274,"date":"2020-03-24T12:25:01","date_gmt":"2020-03-24T12:25:01","guid":{"rendered":"https:\/\/www.maxlee.info\/blog\/?p=2274"},"modified":"2020-03-25T12:33:18","modified_gmt":"2020-03-25T12:33:18","slug":"dow-posts-best-percent-gain-since-1933-on-hope-for-plan-to-rescue-economy-from-coronavirus","status":"publish","type":"post","link":"https:\/\/www.maxlee.info\/blog\/news\/dow-posts-best-percent-gain-since-1933-on-hope-for-plan-to-rescue-economy-from-coronavirus\/","title":{"rendered":"Dow posts best percent gain since 1933 on hope for plan to rescue economy from coronavirus"},"content":{"rendered":"

U.S. Congress inches toward $2 trillion rescue package<\/strong><\/p>\n

<\/p>\n

\"Dow<\/p>\n

Published: March 24, 2020 at 4:21 p.m. ET, By Chris Matthews and Andrea Riquier<\/p>\n

U.S. stocks soared Tuesday, with the Dow Jones Industrial Average notching its biggest one-day point gain ever and its best percentage gain since 1933, a day after plumbing the lowest levels since 2016, amid growing optimism that Congress will come to an agreement on a fiscal stimulus package aimed at combatting the economic impact of the coronavirus epidemic.<\/p>\n

How did benchmarks perform?<\/strong><\/p>\n

The Dow US:DJIA rose 2,112.98 points, or 11.37%, to close at 20,704.91, the S&P 500 index US:SPX advanced 209.93 points, 9.38%, to close at 2,447.33, and the Nasdaq Composite index US:COMP gained 557.18 points, or 8.12%, ending trading at 7,417.86.<\/p>\n

For the year to date though, the Dow is down 27.45%, the S&P 500 has lost 24.25%, and the technology-heavy Nasdaq is 17.33% lower.<\/p>\n

What drove the market?<\/strong><\/p>\n

U.S. lawmakers inched toward an agreement<\/a> on a roughly $2 trillion coronavirus rescue package, helping to reignite buying on Wall Street for the moment, after lawmakers on Monday twice failed to reach an agreement, sending stocks into a fresh tailspin.<\/p>\n

Senate Minority Leader Chuck Schumer said from the Senate floor that he had \u201cvery good\u201d discussions with U.S. Treasury Secretary Steven Mnuchin, and just before noon claimed that an agreement was on the \u201ctwo-yard line.\u201d The trading day ended with no concrete next steps in place, but some investors suggested the market sell-off of the past few weeks may have been overdone.<\/p>\n

\u201cEven in bear markets, you can end up being oversold, and I think that this market was stretched like a rubber band that, at least in the near term, was ready to snap back,\u201d Sam Stovall, chief investment officer at CFRA Research told MarketWatch.<\/p>\n

\u201cIn addition, the market is anticipating some sort of agreement coming out of Congress so that we\u2019ll have both fiscal and monetary stimulus working to support the economy,\u201d he added.<\/p>\n

Losses on Monday came even after the Federal Reserve unfurled its most potent batch of stimulus measures to date<\/a>, saying it would buy an unlimited amount of Treasurys and mortgage-backed securities, among other measures, to stem the harm from the virus and unlock seized up areas of financial markets.<\/p>\n

Markets across the globe, including those of Spain, the U.K., and Italy, have been reeling from planned, temporary business shutdowns, to mitigate the spread of COVID-19, the infectious disease that is derived from a novel strain of coronavirus, and which has infected 390,000 people globally since it was first identified in December.<\/p>\n

The intentional lockdowns are expected to drive much of the world, including the U.S., into a recession.<\/p>\n

However, President Donald Trump on Tuesday floated the idea of restarting the economy soon<\/a> to limit the damage to small and medium-size businesses, a notion that has run against the advice of his coterie of health advisers. That idea may partly be heartening some staunch stock-market bulls, despite the implications of more rapid spread of the illness and a higher death toll.<\/p>\n

\u201cThere\u2019s optimism based on what the president said,\u201d CFRA\u2019s Stovall said. \u201cInvestors are feeling encouraged that this lockdown will not extend into the third quarter.\u201d<\/p>\n

Meanwhile, reports that the outbreak was peaking in Europe also offered some glimmers of hope for market bulls. Indeed, both new cases and deaths have dropped for two days in Italy<\/a>, and the head of Germany\u2019s public health institute said the infections rate in Europe\u2019s largest economy was leveling off.<\/p>\n

\u201cSensibly, investors are now actively seeking these \u2018new world\u2019 sectors and companies in order to grow and protect their wealth,\u201d wrote Nigel Green, chief executive of deVere Group, an independent financial advisory firm, in a Tuesday note.<\/p>\n

In economic data, IHS Markit\u2019s U.S. Purchasing Manager\u2019s Index<\/a> for the manufacturing sector slipped to 49.2 in March from 50.7 in February, while the service sector index sank to 39.1 from 49.9, the lowest level recorded since data became available in October 2009. Any reading below 50 indicates contraction.<\/p>\n

New residential home sales for February fell 4.4% to a annual rate of 765,000 from January\u2019s revised level of 800,000. Economists had predicted a rate of 743,000, according to Econoday.<\/p>\n

See also: Here\u2019s a breakdown of the Fed\u2019s expanded rescue programs to keep credit flowing during the pandemic<\/a><\/p>\n

Which stocks were in focus?<\/strong><\/p>\n

Phillips 66 US:PSX Shares ofare in focus on Tuesday after the oil company said that it secured a $1 billion term loan, cut its capital expenditures for 2020 and temporarily suspended share buybacks.<\/p>\n

Chevron Corp.\u2019s shares US:CVX jumped more than 17% after the oil giant said it would cut its 2020 capex by $4 billion and temporarily halt share repurchases.Energy was the best performing sector on Tuesday.<\/p>\n

Micron Technology Inc. US:MU is scheduled to report fiscal second-quarter earnings after the bell on Wednesday.<\/p>\n

Nike US:NKE is slated to report quarterly results on Tuesday.<\/p>\n

General Motors Co. US:GM said it is planning to draw down about $16 billion from its revolving credit facility. Shares rose 12%.<\/p>\n

Boeing Co.\u2019s US:BA Fitch Ratings on Tuesday cut bonds to two notches above junk, with a negative outlook, which means there\u2019s a one-in-three chance of a further downgrade. Shares were about 20% higher, however, after the company\u2019s CEO said he would not accept the government taking an equity stake in exchange for a bailout.<\/p>\n

Intel Corp. US:INTC shares rose, despite the company announcing it would suspend its share repurchase program.<\/p>\n

Airline stocks surged: United Airlines Holdings Inc. US:UAL shares were up nearly 18%, while American Airlines Group, Inc US:AAL . shares added nearly one-third of their value.<\/p>\n

Shares of Walt Disney Co. US:DIS were up more than 12%, putting the company on track for its best day since 2008.<\/p>\n

How did other markets trade?<\/strong><\/p>\n

In bond markets, the yield on the 10-year U.S. Treasury note BX:TMUBMUSD10Y rose about 8 basis points, to 0.83%.<\/p>\n

Crude oil rose, with the price of a barrel of West Texas Intermediate crude US:CL up 1.5% to $23.72. In precious metals, gold US:GCJ20 surged by about $93, or 6%, to settle at $1,660.80 an ounce.<\/p>\n

European stocks were in rally mode, as the Stoxx Europe 600 XX:SXXP closed about 8.4% higher.<\/p>\n

In Asia overnight, stocks closed higher, with the China CSI 300 XX:000300 up 2.7%, Hong Kong\u2019s Hang Seng index HK:HSI adding 4.5% and Japan\u2019s Nikkei 225 JP:NIK ending the session 7.1% higher.<\/p>\n

The U.S. dollar traded lower, compared to a basket of its major peers. The ICE U.S. dollar index US:DXY was down 0.7%.<\/p>\n

Source: www.marketwatch.com<\/a><\/p>\n","protected":false},"excerpt":{"rendered":"

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