Wall Street is poised for another turbulent week as more details surrounding the novel coronavirus come to light.
The Dow Jones Industrial Average appeared to be heading for even more losses in Monday premarket trading following its worst week since the 2008 financial crisis. However, the benchmark index swiftly turned positive on the heels of the Federal Reserve’s announcement that it would pledge asset purchases with no limit to support the stock market.
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Dow futures, which hit their 5% “limit down” overnight after a massive economic stimulus package failed to advance in Congress, were up 200 points, or 1.05%, at 8:45 a.m. ET. S&P futures grew more than 34 points, or 1.5%, while Nasdaq futures improved 138 points, or nearly 2%.
Early Monday, the central bank announced a major expansion of lending programs, including purchasing commercial mortgage-backed securities issued by government-supported entities as well as not limiting the purchases of Treasury and mortgage securities that it approved one week ago.
“While great uncertainty remains, it has become clear that our economy will face severe disruptions,” the Fed said. “Aggressive efforts must be taken across the public and private sectors to limit the losses to jobs and incomes and to promote a swift recovery once the disruptions abate.”
Today marks the first time the New York Stock Exchange trading floor has been shuttered and switched completely to electronic trading — a decision that was made last week to help prevent the spread of COVID-19, which has killed at least 400 people in the United States and sickened more than 32,000.
Nearly 100 retail organizations — among them, the Footwear Distributors and Retailers of America, the American Apparel & Footwear Association and the National Retail Federation — called on the Trump administration over the weekend to extend a helping hand to retail businesses as well as their suppliers, as many retailers have been forced to temporarily close their doors due to government emergency containment measures.
“The economic harm from social distancing and mandatory store closures is real. Layoffs and economic hardship will surely follow, particularly for smaller, specialty retailers and brands,” read the letter, which was addressed to President Donald Trump and dated March 21. “The biggest single issue facing the industry right now is liquidity, and federal stimulus efforts must be swift and flexible enough to address the urgent need for access to credit to keep these businesses afloat.”
The Senate will hold a vote today on the economic rescue plan, which is also expected to provide payments of $1,200 in checks to most Americans.
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