Wall Street Close: Trump walks back on stimulus, stocks rally sharply
- Dow Jones Industrial Average added 530.7 points, or 1.91%.
- The S&P 500 gained 58.5 points, or 1.74%, to 3,419.45.
- The Nasdaq Composite put on 210.00 points, or 1.88%.
US stocks rallied to close higher on Wednesday on renewed optimism that at least a partial deal on more US fiscal stimulus can happen.
The US President Donald Trump has urged Congress to pass a series of smaller, standalone bills that would include a bailout package for the airline industry battered by the coronavirus pandemic.
Trump favours immediate spending on paycheck protection ($135bn), airlines ($25bn) and a standalone bill of $1200 stimulus checks for individuals.
Consequently, the Airline shares jumped, and United Airlines UAL rose 4.3%.
The Dow Jones Industrial Average added 530.7 points, or 1.91%, to 28,303.46, the S&P 500 gained 58.5 points, or 1.74%, to 3,419.45 and the Nasdaq Composite put on 210.00 points, or 1.88%, to 11,364.60.
Analysts at ANZ bank explained that this latest push for stimulus appears to contradict his previous sentiment only a day earlier.
''Democrats are unlikely to play ball after saying they favour a comprehensive package over a piecemeal approach.
The baseline scenario of no new stimulus ahead of the 3 November election is playing out.
The question is: will there be any stimulus implemented before the new president’s inauguration on 20 January? If not, the situation could lead to extended erosion of fiscal support in coming months, persistent gaps for households and firms in need, and a renewed focus on potential Fed easing options (like increased QE).''
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