The Dow Gained 1,000 Points on Hope for Stimulus

Nicholas Jasinski Markets Now Markets BA Boeing Dow Gains Federal Reserve Trump administration U.S. Treasury Steven Mnuchin Donald Trump North America United States Government Finance Government Budget/Taxation Economic News Political/General News Respiratory Tract Diseases Health Medical Conditions Outbreaks/Epidemics Novel Coronaviruses Infectious Diseases Equity Markets Commodity/Financial Market News Content Types Factiva Filters C&E Exclusion Filter BA G/FED G/TRE N/DJN N/GEN N/GENI N/HLT N/IEN N/MKT N/NWS N/STK N/TAX N/WER R/NME R/US Barrons.com Barrons Blogs Wires COMP DJIA Dow Jones Industrial Average Nasdaq Composite S&P 500 SPX CODES_REVIEWED Coronavirus Markets Now Markets author Nicholas Jasinski author|Nicholas Jasinski topicid 8575 name Nicholas Jasinski extractedtext Nicholas Jasinski rank 1 codetype author code nicholas_jasinski nameformat surname_first author Nicholas Jasinski id Nicholas Jasinski barrons_display_brand BARMKTNOW barrons_display_brand|BARMKTNOW codetype BARRONS_DISPLAY_BRAND name Markets Now source MANUAL value BARMKTNOW code BARMKTNOW canbedisplaybrand true status modified barrons_display_subject BARMKTS barrons_display_subject|BARMKTS canbedisplaysubject true codetype BARRONS_DISPLAY_SUBJECT name Markets source MANUAL value BARMKTS code BARMKTS status modified co Dow Gains co|Dow Gains fullextractedtext Dow Gains displayname Dow Gains name Dow Gains extractedtext Dow Gains source FACTIVA subcat com codetype co code dow_gains co boeing co|boeing country US symbol BA codetype co displayname Boeing why occur extractedtext Boeing source FACTIVA seoname boeing name Boeing countrycode US relevancerange low chartingsymbol STOCK/US/XNYS/BA fcode boeing fullextractedtext Boeing ticker BA confidence 100 subcat com code boeing relevance 21 significance passing confidencerange high exchange NYSE exchangeisocode XNYS onlinesignificance passing-mention co usdtr co|usdtr fullextractedtext U.S. Treasury codetype co displayname U.S. Treasury confidence 100 why occur extractedtext U.S. Treasury source FACTIVA subcat org code usdtr relevance 16 name U.S. Treasury significance passing confidencerange high relevancerange low fcode usdtr onlinesignificance passing-mention co fed co|fed fullextractedtext Federal Reserve codetype co confidence 92 extractedtext Federal Reserve source FACTIVA subcat org code fed relevance 1 name Federal Reserve confidencerange high relevancerange verylow fcode fed co Trump administration co|Trump administration fullextractedtext Trump administration codetype co displayname Trump administration extractedtext Trump administration source FACTIVA subcat gov code trump_administration name Trump administration company BA company|BA name Boeing significance PASSING-MENTION djn G/TRE djn|G/TRE significance passing name G/TRE why occur source FACTIVA fcode G/TRE codetype djn code g_tre onlinesignificance passing-mention djn N/STK djn|N/STK significance prominent name N/STK why about source FACTIVA fcode N/STK codetype djn code n_stk onlinesignificance prominent djn G/FED djn|G/FED codetype djn why about source FACTIVA occurs true code g_fed name G/FED significance prominent fcode G/FED onlinesignificance prominent djn N/TAX djn|N/TAX codetype djn why about source FACTIVA code n_tax name N/TAX significance prominent fcode N/TAX onlinesignificance prominent djn N/GENI djn|N/GENI codetype djn name N/GENI why lineage source FACTIVA code n_geni fcode N/GENI djn N/IEN djn|N/IEN codetype djn name N/IEN why lineage source FACTIVA code n_ien fcode N/IEN djn BA djn|BA codetype djn why occur source FACTIVA code ba name BA significance passing fcode BA onlinesignificance passing-mention djn N/MKT djn|N/MKT codetype djn why about source FACTIVA code n_mkt name N/MKT significance prominent fcode N/MKT onlinesignificance prominent djn N/NWS djn|N/NWS codetype djn why about source FACTIVA code n_nws name N/NWS significance prominent fcode N/NWS onlinesignificance prominent djn N/GEN djn|N/GEN codetype djn name N/GEN why lineage source FACTIVA code n_gen fcode N/GEN djn N/HLT djn|N/HLT codetype djn name N/HLT why lineage source FACTIVA code n_hlt fcode N/HLT djn R/US djn|R/US codetype djn why about source FACTIVA code r_us name R/US significance prominent fcode R/US onlinesignificance prominent djn R/NME djn|R/NME codetype djn name R/NME why lineage source FACTIVA code r_nme fcode R/NME djn N/DJN djn|N/DJN codetype djn name N/DJN source DJN-CONTROL value N/DJN code n_djn status modified inactivebydefault true djn N/WER djn|N/WER codetype djn name N/WER source DJN-CONTROL value N/WER code n_wer status modified inactivebydefault true first_publish_headline Markets Are Jumpy After Dow’s Biggest Drop Since 1987 first_publish_headline|Markets Are Jumpy After Dow’s Biggest Drop Since 1987 flow NWREGULAR flow|NWREGULAR codetype FLOW name Wires source MANUAL value NWREGULAR code NWREGULAR status modified flow Barrons.com flow|Barrons.com codetype FLOW name Barrons.com source MANUAL value Barrons.com code online status modified name Online title Product code Barrons.com flow Barrons Blogs flow|Barrons Blogs codetype FLOW source MANUAL title Product code Barrons_Blogs name Barrons Blogs value Barrons Blogs status modified headline The Dow Gains as Hope for Spending Package Grows headline|The Dow Gains as Hope for Spending Package Grows id facebook id|facebook news_tab_url https://www.barrons.com/articles/markets-are-jumpy-after-dows-biggest-drop-since-1987-51584457665 index Dow Jones Industrial Average index|Dow Jones Industrial Average symbol DJIA country US codetype index displayname Dow Jones Industrial Average extractedtext Dow Jones Industrial Average source MANUAL code djia name Dow Jones Industrial Average significance prominent exchange Dow Jones Global exchangeisocode DOW JONES GLOBAL chartingsymbol INDEX/US/DOW JONES GLOBAL/DJIA status modified onlinesignificance prominent index S&P 500 index|S&P 500 symbol SPX country US codetype index displayname S&P 500 Index extractedtext S&P 500 source MANUAL code spx name S&P 500 significance prominent exchange S&P US exchangeisocode S&P US chartingsymbol INDEX/US/S&P US/SPX status modified onlinesignificance prominent index Nasdaq Composite index|Nasdaq Composite symbol COMP country US codetype index displayname NASDAQ Composite Index extractedtext Nasdaq Composite source MANUAL code comp name Nasdaq Composite significance prominent exchange U.S.: Nasdaq exchangeisocode XNAS chartingsymbol INDEX/US/XNAS/COMP status modified onlinesignificance prominent inset inset-1 inset|inset-1 responsive layout inline inset inset-2 inset|inset-2 responsive layout wrap inset inset-3 inset|inset-3 responsive layout wrap inset inset-4 inset|inset-4 responsive layout wrap media media-3 media|media-3 responsive layout wrap softcrop Horizontal imphotoid im-165455 location https://images.barrons.com/im-165455/?size=1.5 media media-2 media|media-2 responsive layout inline media media-1 media|media-1 softcrop Horizontal imphotoid im-165455 location https://images.barrons.com/im-165455/?size=1.5 ns m11 ns|m11 significance prominent name Equity Markets why about source FACTIVA fcode m11 codetype ns code m11 onlinesignificance prominent ns e211 ns|e211 codetype ns why about source FACTIVA code e211 name Government Budget/Taxation significance prominent fcode e211 onlinesignificance prominent ns e21 ns|e21 codetype ns name Government Finance why lineage source FACTIVA code e21 fcode e21 ns ecat ns|ecat codetype ns name Economic News why lineage source FACTIVA code ecat fcode ecat ns gout ns|gout codetype ns why about source FACTIVA code gout name Outbreaks/Epidemics significance prominent fcode gout onlinesignificance prominent ns mcat ns|mcat codetype ns why about source FACTIVA code mcat name Commodity/Financial Market News significance prominent fcode mcat onlinesignificance prominent ns gsars ns|gsars codetype ns why about source FACTIVA code gsars name Novel Coronaviruses significance prominent fcode gsars onlinesignificance prominent ns gcat ns|gcat codetype ns name Political/General News why lineage source FACTIVA code gcat fcode gcat ns gcold ns|gcold codetype ns name Respiratory Tract Diseases why lineage source FACTIVA code gcold fcode gcold ns ghea ns|ghea codetype ns name Health why lineage source FACTIVA code ghea fcode ghea ns gmed ns|gmed codetype ns name Medical Conditions why lineage source FACTIVA code gmed fcode gmed ns gspox ns|gspox codetype ns name Infectious Diseases why lineage source FACTIVA code gspox fcode gspox ns ncat ns|ncat codetype ns why lineage source FACTIVA code ncat name Content Types internalsymbol true fcode ncat ns nfact ns|nfact codetype ns why lineage source FACTIVA code nfact name Factiva Filters internalsymbol true fcode nfact ns nfce ns|nfce codetype ns why lineage source FACTIVA code nfce name C&E Exclusion Filter internalsymbol true fcode nfce nwchain SB527686179203171734345045862671411052181461 nwchain|SB527686179203171734345045862671411052181461 pe Donald Trump pe|Donald Trump topicid 159 visible 1 displayname Donald Trump name Donald Trump extractedtext Donald Trump topicname Donald Trump source FACTIVA title President and chief executive officer seoname donald-trump codetype pe code donald_trump nameformat surname_first pe 25002 pe|25002 lastname Mnuchin codetype pe displayname Mnuchin, Steven confidence 92 why occur extractedtext Steven Mnuchin source FACTIVA code 25002 relevance 50 name Steven Mnuchin significance passing firstname Steven nameformat surname_first confidencerange high relevancerange low fcode 25002 onlinesignificance passing-mention re usa re|usa codetype re why about source FACTIVA subcat cntry code usa name United States significance prominent fcode usa onlinesignificance prominent re namz re|namz codetype re why lineage source FACTIVA subcat snr code namz name North America fcode namz relay SYND relay|SYND codetype RELAY name Syndication source EXPANDER value SYND code synd status modified statistic CODES_REVIEWED statistic|CODES_REVIEWED name CODES_REVIEWED value CODES_REVIEWED codetype STATISTIC code CODES_REVIEWED subject BARMKTS subject|BARMKTS codetype SUBJECT selectable true title Markets code BARMKTS name Markets canbedisplaysubject true ruleid BARMKTS value BARMKTS status modified subject BARCORONA subject|BARCORONA codetype SUBJECT title Coronavirus code BARCORONA name Coronavirus canbedisplaysubject true ruleid BARCORONA value BARCORONA status modified subject BARMKTNOW subject|BARMKTNOW codetype SUBJECT title Markets Now code BARMKTNOW name Markets Now ruleid BARMKTNOW value BARMKTNOW canbedisplaybrand true status modified wordcount 944 wordcount|944 Photograph by Spencer Platt/Getty Images The Dow Gains as Hope for Spending Package Grows The Dow Gains as Hope for Spending Package Grows Markets Are Rising After Dow’s Biggest Drop Since 1987

Investors are simultaneously trying to assess the damage from the coronavirus outbreak and how effectively governments can counter it.

The Dow Gained 1,000 Points on Hope for Stimulus

Stocks got a twin boost from Fed action and word on what a government stimulus plan might include.

https://www.barrons.com/articles/dow-jones-industrial-average-has-second-worst-day-ever-ive-got-to-believe-there-are-buyers-out-there-51584400279 https://www.barrons.com/articles/oil-prices-saudi-arabia-russia-brent-wti-energy-demand-supply-51584461253?mod=hp_LATEST https://www.barrons.com/articles/preferred-bank-stocks-yield-6-after-a-market-selloff-51584456817?tesla=y https://www.barrons.com/articles/global-markets-have-been-bloodied-but-maybe-not-enough-says-bofa-51584462228?mod=hp_LATEST https://www.barrons.com/articles/the-vix-fear-gauge-is-soaring-its-unlikely-to-come-down-anytime-soon-51584050364 https://asset.barrons.com/dynamic-insets/charts/cdc_50495668a6882d0d3372e007.json https://www.wsj.com/articles/trump-administration-seeking-850-billion-stimulus-package-11584448802 https://asset.barrons.com/dynamic-insets/charts/cdc_2465b8df37113e3ef3b24197.json https://www.barrons.com/articles/coronavirus-cases-in-the-u-s-now-top-4100-johns-hopkins-51584395492 https://www.barrons.com/articles/monday-selloff-sp500-coronavirus-51584386946 mailto:nicholas.jasinski@barrons.com The Dow Gains as Hope for Spending Package Grows By Nicholas Jasinski Photograph by Spencer Platt/Getty Images Traders worked on the floor of the New York Stock Exchange as President Trump spoke on Monday.

U.S. stocks closed near their highest levels of the day, boosted by word of what a federal stimulus package might look like and news of the Federal Reserve’s latest effort to keep markets running smoothly.

The rally, which lifted the Dow Jones Industrial Average by nearly 1,000 points, followed a jittery morning as investors assessed how bad the economic damage from the coronavirus will be, and government efforts to respond. Major indexes suffered their worst one-day drops since 1987’s Black Monday crash on Monday.

The fuel for Tuesday’s afternoon rebound came at an early afternoon press conference by President Donald Trump and members of the White House’s coronavirus task force detailing many of the potential stimulus measures the administration is seeking.

The Dow Jones Industrial Average closed up 1,049 points, or 5.2%, despite being weighed down by a decline in Boeing stock. The S&P 500 gained 6% and the Nasdaq Composite rose 6.2%.

Further coverage

Why the Saudis Will Win the Oil Fight Preferred Bank Stocks Now Yield Over 6% A Contrarian Buy Signal Has Been Triggered

All three indexes have had seven days straight of moves of at least 4%, including the three sessions of swings greater than 9%. Investors see more wild movements ahead. The Cboe Volatility Index, or VIX, fell 10% from Monday’s closing level of about 83—an extremely elevated reading for the index, which measures expectations of future volatility based on index options pricing—but remains way above normal levels..

Bond prices fell, lifting their yields. The yield on the 10-year U.S. Treasury ticked up 27 basis points, or hundredths of a percentage point, to 0.997%. That was the note’s largest one-day yield gain since September 2008. The price of gold climbed 2.9%. Both are considered haven assets, and normally rise together when riskier assets like stocks fall.

The performance of various sectors within the S&P 500 suggested a defensive posture on Tuesday. Utilities, consumer staples, and health care stocks rose 13%, 8%, and 6%, respectively. The more economically sensitive consumer discretionary and energy sectors were Tuesday’s laggards, up 3% and 0.2%, respectively.

https://asset.barrons.com/dynamic-insets/charts/cdc_50495668a6882d0d3372e007.json

The price of oil was down 6.3% to $26.88 a barrel. The price has fallen by close to 60% this year.

The Trump administration is speaking with Congressional legislators about an economic-stimulus package to the tune of roughly $850 billion. It is meant to counter the economic blow of the novel coronavirus outbreak and the limits on manufacturing and consumer activity required to slow its spread. The plan could include targeted stimulus for industries such as airlines that are most affected, as well as broader relief including a payroll-tax cut and emergency loans for small businesses.

Treasury Secretary Steven Mnuchin even mentioned payments to individuals, something he described as akin to “business interruption payments” for workers.

The Federal Reserve is already in full stimulus mode, having lowered its benchmark interest rate at an emergency meeting for the second time in as many weeks on Sunday, to close to zero. The central bank is also working to stimulate lending and shore up liquidity in Treasury and money markets, through vast new bond purchases of at least $700 billion, as well as other measures.

https://asset.barrons.com/dynamic-insets/charts/cdc_2465b8df37113e3ef3b24197.json

The bank said Tuesday that it would launch a commercial-paper lending facility, to help smooth out the market in which companies seek short-term funding. That echoes a move the central bank last implemented during the financial crisis in 2008.

The supportive monetary policy and potential fiscal boost come as the latest figures suggest over 4,100 confirmed cases of Covid-19—the respiratory disease caused by the novel coronavirus—in the U.S. The number that will continue to rise and authorities’ unprecedented measures to combat it will continue to weigh heavily on economic activity and corporate earnings.

The Commerce Department’s February retail sales data came in weaker than expected on Tuesday morning, at a 0.5% decline from a month earlier. Economists had forecast a 0.1% increase in spending at stores, online, and at bars and restaurants. Plummeting markets and limits on travel and public gatherings will take a major dent out of March’s retail sales figures, out on April 15.

The likelihood of avoiding at least a temporary recession is close to zero, and markets have moved to price that in with lightening speed.

Two of the five steepest U.S. market drops in history have happened in the previous three trading days. The Dow Jones Industrial Average’s 2,997-point, or 12.9%, drop on Monday ranks second-worst in the index’s history, only behind 1987’s Black Monday crash, when the index dropped 22.6%. In third and fourth place are Oct. 28 and Oct. 29, 1929—the worst two days of the Great Crash of 1929. In fifth is last Thursday’s 9.99% tumble.

The S&P 500 also had an ugly day on Monday, down 12%, while the Nasdaq Composite plummeted 12.3%.

Write to Nicholas Jasinski at nicholas.jasinski@barrons.com

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.