Stocks surge toward huge gains on hopes for US virus aid

Tuesday, March 24, 2020

NEW YORK (AP) — Stocks are surging on Wall Street Tuesday and joined a worldwide rally as optimism rose, for one day at least, that government officials and central banks are unleashing enough aid to ease the economic pain caused by the coronavirus outbreak.

The S&P 500 galloped more than 7% higher, and the Dow jumped more than 1,500 points in afternoon trading as a wave of buying interrupted what has been a brutal month of nearly nonstop selling. Despite the gains, investors were far from saying markets have hit bottom. Rallies nearly as big as this have punctuated the last few weeks, and none lasted more than a day.

Tuesday’s optimism was born in large part from signs that Congress and the White House are nearing an agreement on close to $2 trillion in aid for the economy. Investors have been frustrated waiting for the U.S. government to do what it can to help the economy, which is shutting down by the day. The Federal Reserve is doing nearly all it can, and it launched its latest round of extraordinary aid Monday.

“I don’t think there’s any more confidence in the fundamental outlook, but the fact that we’re making progress is good news,” said Katie Nixon, chief investment officer at Northern Trust Wealth Management. “It’s sort of like, keep the patient alive in the emergency room so you can provide some treatment options.”

The buying circled the world. South Korean stocks surged 8.6%, Germany’s market jumped 11% and Treasury yields rose in a sign that investors are feeling less fearful.

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