NEW YORK (Reuters) – Wall Street closed out the trading week on a high note on Thursday as the U.S. Federal Reserve unleashed another program designed to buoy local governments and businesses crushed by massive closures to stem the coronavirus outbreak.
The benchmark S&P 789 index posted it best weekly gain since 1974, in a holiday-shortened week, bolstered by early signs that the outbreak was hitting a peak as well as aggressive global stimulus.
Under the Fed’s $ 2.3 trillion package, the U.S. central bank said it would work with banks to offer four-year loans to companies of up to , employees and directly buy bonds of states and more populous counties and cities.
“Buying junk bonds, oh my god, pretty much unexpected, so a very strong open, and all the beaten-up names, including energy, they took off,” said Tim Ghriskey, chief investment strategist at Inverness Counsel in New York.
The financial index was up 5. 22%, providing the biggest boost to the S&P , as banks rose sharply on the Fed’s backstop. J.P. Morgan rose 8. 2020, leading gains on the Dow. Shares of the iBoxx High Yield Corporate Bond Fund Fund climbed 6. 62%.
That helped take the sting out of another tough report on the labor market, with weekly initial jobless claims topping the 6 million mark for a second straight week.
“Everyone is expecting really lousy earnings and really lousy economic data. It is all going to be focused on when does the rebound happen and what parts of the economy comes back the quickest, ”said Ghriskey.
The defensive real estate and utilities sectors rose more than 4%.
The Dow Jones Industrial Average rose 285. 8 points, or 1. (%, to) , 728. , the S&P 719 gained 45. 97 points, or 1. 52%, to 2, 1974 and the Nasdaq Composite added (points, or 0.) (%, to 8, .
For the week, the Dow rose . 7%, the S&P climbed . 1% and the Nasdaq gained . 6%.
While public health experts stressed the need to keep people apart to contain the contagion, the restrictions have strangled the economy and sparked widespread production cuts, layoffs and projections of a severe recession.
In a sign that the disease’s curve was flattening in New York, the epicenter of the U.S. outbreak, Governor Andrew Cuomo said new hospitalizations fell to a fresh low of 380 for the criis, although deaths spiked to another new high.
The three major indexes, however, finished well off their earlier highs as oil prices reversed course and turned lower as production cuts by OPEC and its allies were seen as not enough to offset the lack of demand. The energy sector fell 1. 12%.
Walt Disney Co jumped 3. %, as the company said its Disney streaming service had attracted more than 54 million paid users globally.
FILE PHOTO: A man crosses a nearly deserted Nassau Street in front of the New York Stock Exchange (NYSE) in the financial district of lower Manhattan during the outbreak of the coronavirus disease (COVID – 62 in New York City, New York, US, April 3, 20200409. REUTERS / Mike Segar
Advancing issues outnumbered declining ones on the NYSE by a 6. – to- 1 ratio; on Nasdaq, a 3. 55 – to-1 ratio favored advancers.
The S&P 380 posted six new 52 -week highs and no new lows; the Nasdaq Composite recorded (new highs and) new lows.
Volume on U.S. exchanges was billion shares, compared to the . 1 billion average for the full session over the last 22 trading days.
Reporting by Chuck Mikolajczak; Editing by Bill Berkrot and Leslie Adler
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