Stock market news live: Stocks boosted by Trump coronavirus stimulus plans; Dow rockets over 1,000 points

Story by Yahoo Finance
Written by Emily McCormickand and Javier E. David

Stocks surged on Tuesday, offering some respite from the prior session’s gruesome sell-off that saw the Dow Jones Industrial Average post its largest-ever point drop, and its worst sell-off on a percentage basis since Black Monday of 1987.

[Read more: Coronavirus jitters send Dow swooning to worst-ever point loss, closes at near 3-year low]

The coronavirus pandemic continues to keep investors on edge, as one major economy after the other shuts its borders to stem the outbreak. And Tuesday’s move was not enough to undo the damage wrought by a viral outbreak that has a stranglehold on the world’s economy — and driven stocks from record highs to a bear market in just under a month.

Worldwide, the total of coronavirus infections is creeping inexorably toward 200,000 — with over 5,000 alone in the U.S. — amid a death total that is closing in on 8,000.

Volatility stemming from the outbreak has seen the Dow move up or down by 1000 points or more for 7 straight days, and 11 times total in the last month, according to Yahoo Finance data. Based on the stock market’s historically steep declines over the past few weeks, market participants have already priced in a recession, according to Fundstrat head of research Tom Lee.

“Over the past month, equity markets and financial assets broadly, have been attempting to price in the dual shock of a pandemic and the sudden collapse in oil prices (which is viewed by markets as negative given effect on high-yield and drilling-related GDP),” Lee wrote in a note late Monday.

Nevertheless, markets rallied sharply in Tuesday’s session as the Trump administration discussed further measures to help the American people and companies most hurt by the fall-out from the coronavirus pandemic, which may top $1 trillion.

Treasury Secretary Steven Mnuchin said during a White House press briefing that “the president wants to give cash now” to the public, and is discussing doing so in the next two weeks. He also said the administration “believes in keeping the markets open,” but is considering shortening market hours eventually amid the outbreak.

A day earlier, President Donald Trump had offered a grim assessment of the COVID-19 crisis, acknowledging that the U.S. “may be” heading toward a recession, and social distancing measures could drag on well into the summer months.

The U.S. government, however, has also underscored a willingness to provide at least some aid to individuals and corporations most affected by the outbreak to soften the blow to the economy as much as possible. Trump has vowed to “back the airlines 100%,” with air carriers having been hit hard by a steep drop-off in travel demand and in desperate need of government aid to survive.

In Congress, the House of Representatives unanimously passed a revised multi-billion coronavirus emergency bill Monday evening and sent it up to the Senate for a vote. The package would include at least $750 billion to combat disruptions from the coronavirus outbreak, providing funds for hospitals, expanded unemployment insurance, small businesses and food aid.

The situation overseas also continues to evolve, with the entire European Union following moves made by Italy, Spain and France to shut their borders. In North America, Canada closed its borders to most non-residents, offering some exemptions including for U.S. citizens.

As travel grinds to a halt, economists are increasingly bracing for a major hit to global GDP growth in 2020.

“In a realistic scenario where travel and tourism dropped by 50% in four or five months, annual global GDP growth would be reduced by about 0.7 percentage points,” Jennifer McKeown, head of global economics service as Capital Economics, wrote in a note Tuesday. “Indirect effects or disruption to domestic travel could make the hit even harder. What’s more, the strain on insurers and airlines is adding to the risk of a financial crisis.”

4:00 p.m. ET: Stocks claw back from the ‘new Black Monday’
Investors cheered President Donald Trump’s aggressive plan to backstop the U.S. economy with fiscal stimulus worth a reported $1 trillion, and the Federal Reserve’s latest bid to shore up stressed financial markets amid the worldwide spread of the coronavirus.
___________________________________________________________

Here’s where major benchmarks ended the day:

S&P 500 (^GSPC): +142.73 (+5.98%) to 2,528.86
Dow (^DJI): +1,048.49 (+5.19%) to 21,237.01
Nasdaq (^IXIC): +430.19 (+6.23%) to 7,334.78

Crude (CL=F): -$1.77 (-6.17%) to $26.93 a barrel
Gold (GC=F): +$49.30 (+3.32%) to $1,535.80 per ounce

10-year Treasury (^TNX): +26.9 bps to yield 0.9970%