- Buoyed by promises of a lofty $ billion stimulus package, the US stock market rallied aggressively on Tuesday.
- The Dow Jones was no exception, and it erased a good chunk of Monday’s historic 3, (point loss.)
- There has been some positive news in Europe, as coronavirus infections in Spain and Italy slowed overnight.
The Dow Jones leaped as much as 1, 10 points on Tuesday as promises of economic stimulus soothed a troubled stock market.
Wall Street is finally seeing the kind of monetary response it craved, and investors also cheered a glimmer of light in European coronavirus data.
Dow Jones Soars After Governments Go All in to Fight Coronavirus
All three of the major US stock market indices enjoyed substantial gains on Tuesday.
- The Dow rallied 959. 67 points or 3. 85% to 30, . .
- The S&P
(bounced 4.) (% to 2,) 2. - The Nasdaq soared 5. (% to 7, ) .
Commodity markets saw some volatility amid a massive surge in the US dollar. Crude oil (-5.8%) extended its slide, falling back into the $ 56 handle.
While the strong USD was terrible news for silver, the price of gold jumped 3% as already debt-laden Western powers announced whopping stimulus packages.
The Trump administration would like to send American adults a $ 1, 10 check, with talk of an $ 968 billion fiscal injection.
In the UK, Finance Minister Rishi Sunak announced they would do “whatever it takes,” with around $ (billion allocated for loans for businesses.)
Stock Market Faces Lengthy Battle as Apple Shuts Stores ‘Indefinitely’
These promises of stimulus are a response to the darkening economic environment , which was highlighted by today’s weak retail sales data.
The Headline figure contracted 0.5%
The economic impact of the coronavirus will grow severe severe the longer it drags on. Donald Trump spooked the Dow Jones on Monday when he talked about the crisis festering till mid-Summer .
Confirming the likelihood of a drawn-out battle, Apple is no longer committed to reopening its US stores in two weeks ’time. Instead, they will be closed indefinitely.
Boris Schlossberg at BK Asset Management outlined the cash flow issues affecting US businesses in a recent note. He says large publicly traded corporations are faring considerably better than smaller companies.
Investors are essentially flying blind as the length of the containment is uncertain, and the economic impact of the health measures could be catastrophic.
) In the US, for example, companies have enough cash on hand for about 90 days of payroll – but that figure applies only to the largest corporations rather than the % of small and medium-sized businesses which will in effect become insolvent if the quarantine lasts that long
coronavirus infection numbers continue to rise rapidly. The nation now has more than 5, (infections
, according to the latest John Hopkins data.
Some good news was finally seen in Europe, though, even as the European Union slammed its external borders shut for days
Dow Stocks: Boeing Drags; Intel & Walmart Surge
Tuesday was relatively bright for the Dow
Leading the Dow Jones was an astonishing 60% rally in Dow Inc. There were also impressive 17% gains for Walmart as it enjoys a panic-buying sales boom.
Microsoft ( 6%) and Intel ( 27. 5%) highlighted the tech sector’s recovery. Apple powered through $ (with a 4% rally.)
Yet Boeing stock (-5%) continues to struggle , as talk of a bailout does little to assuage fears about the dire economic straits that the company finds itself in.
Chevron lagged the broader index as oil prices fell, though Exxon Mobil was able to rise even despite its rating downgrade on Monday .
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