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Stocks - S&P Caps Best Week Since '74 as Powell Signals More Ammo in Fed Bazooka

Published 04/09/2020, 04:09 PM
Updated 04/09/2020, 04:14 PM
© Reuters.

By Yasin Ebrahim 

Investing.com –  The S&P ended Thursday higher, capping off a shortened trading week with its biggest weekly gain since 1974 as the Federal Reserve delivered another wave of stimulus to cushion the economic impact from the Covid-19 pandemic.

The S&P 500 gained 1.45%, taking its gains for the week to 12.1%, its biggest one-week rally since 1974. The Dow rose 1.22%, or 286 points, and the Nasdaq Composite added 0.77%.

Just weeks after its unprecedented measures to avert a financial crisis, the Federal Reserve intervened again, unveiling a $2.3 trillion stimulus package to not only create new loan programs but bolster current lending facilities too.

For the first time ever, the Fed offered loans – up to $500 billion - to states and municipalities and the central bank also expanded its bond-buying program to include both high-yield bonds and high-yield exchange traded funds (ETFs).

Following the Fed's move, Chairman Jerome Powell reassured investors the central bank is willing to continue to use its powder to pave as smooth a path for the economic recovery as needed.

"We will continue to use these powers forcefully, proactively and aggressively until we are confident that we are solidly on the road to recovery," Powell said.

Powell also said he saw no reason for banks to cut dividends as they are well-capitalized.

Wells Fargo (NYSE:WFC) rallied 9.6% JPMorgan Chase (NYSE:JPM) surged 9%, and Bank of America (NYSE:BAC) was up 6%. 

OPEC and its allies also garnered some of the spotlight as oil prices reversed sharply amid fears the coordinated supply cut agreement would do little offset a widely expected supply overhang in the wake of a coronavirus-led hit to demand.

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OPEC delegates agreed to reduce total output by 10 million barrels a day in May and June with Saudi Arabia cutting 3.3 million barrels and Russia cutting 2 million barrels, The Wall Street Journal reported.

WTI futures settled at $22.76, down 9.29% after surging more than 12% intraday, forcing energy to cut gains to end down 1%.

Latest comments

my prediction of the day. when 9:30 pass, nothing will move. the market will be like dead quiet. no one will buy and no one will sell. it is like the end of the world. happy good friday. 😷
market closed tomorrow?
Yup, Good Friday
This is like black or red comes out 10 times in a row when you play rullet, besides the dealer telling you it's going to be same color for a while. so are you going to trust the dealer or your guts...
Hey, who cares about bubbles? As long as the fed prints, markets go up. Don't forget, real economy and stock market are 2 different things. Valuations are not based on earnings now, so don't bother about value, just buy that stocks will go up as long as fed says they will print another 8 trillion and followed by another 20 trillion to stabilise markets. Trust the power of fed to make markets go up.
So basically they are propping up every company in the US market which makes their valuations worthless. These companies have revenues down 50% or more.
Do not complain just Strong Buy
Tommorow, get ready for another rally, this rally will continue till the presidential election, and after that what?
it is hard to take You seriously if You don’t even know when the market is closed. Sorry
lolol, got em
Okay, first come with a better name for ppl to take u seriously, and plus I was sharing my opinion, got problem with that?
Market manipulation is getting out of hand. Most people don't buy stocks. People work hard and save that money little by little in real life. Why should people risk their assets to being devalued by infinite money pouring in the market? To protect the 1% and people playing with digital money in wallstreet? Ridiculous. Look what this world have become. Instead of making masks and antidotes to tackle the virus. Trying to cheat its way out by printing money.
why wti price going down? while the saudi-russian deal had done? any comment
there are only rumours. currently, there is no agreement signed. never trust the medua. check always the source
that is not an correct answer to answer his question. When you answer people question, please make sure utter the facts.
It’s down because although a deal is good, the cut is minimal compared to the loss in demand (for oil). Expect it to remain low until the pandemic starts to significantly ease and human activity increases.
How is the Fed being so terrified that it is buying Trillions of dollars of distressed bonds a sign that things are good. They are up to 6T in balance sheet adds, plus 2T of fiscal response. That should be terrifying
Can't let the Fed induced bubble that they have created since the last recession burst. So here they are with there "unlimited" funds put a bigger bubble around the first one.
Honestly!! back in 1974 it was a real increase in markets based on strength in the economy and jobs. Now its just stimulus after stimulus as millions are out of work and there is no economy as global supply chains are dead...why can't there be some real market price discovery?
Everything is fake. Is the Matrix real?
 I don’t think capitalist markets are dead, in fact quite the opposite. Many companies have become so big that governments cannot afford for them to fall, how do you combat unemployment if airlines like American Airlines & Delta Airlines go bust?
 I don’t think capitalist markets are dead, in fact quite the opposite. Many companies have become so big that governments cannot afford for them to fall, how do you combat unemployment if airlines like American Airlines & Delta Airlines go bust?
What is the point of making sure it keeps hitting all time highs? There are many years ahead, give it time to do things naturally instead of interfering with the "free" markets all the time...
Trumps want a reelection. So no
Doesn’t matter for him if it causes suffering in the next 10 years, he’ll be long dead by then.
So true!
Anyway Who is that guy? I have wandering about it
"To infinity and beyond" -buzz light year
Print print print. Gold gold gold!🤑
So America admits this isn't a FREE MARKET. LOL! And for all the bashing of "regimes" you've become one of them
I am suing the fed for market manipulation, just to get on the news. Some super smart asian dude will definitely proof it for me
Remind me, what else was going on in 1974? It's been a while.
$500B another $500B next week Monday, FEDs can forgive all the debts of many Americans if they can pump this much money to tem market
my man, but we savers paid the bill! It is not even the fed.
Looking at my stocks markets flat algorithms want it that way but for how long.
I would like to get some Fed money or a bailout so that I can buy a Maserati.
Fed infinity money printing worries me now. My asset value goes down as devaluation of dollar accelerates. How should I protect my asset value against infinity money printing?  Stocks too risky to get in and cash lose value everyday with currency expansion. Bitcoin is even riskier than equity market.  What should we do now to protect our asset against the infinity money printing?
pray they get caught and are handed the death sentence!
invest in Asia, that's what happened after 2008. we were will cushioned throughout most crashes after 1997 because we no longer took advice from 'murica
sad but true
welcome back to reality next week, bulls
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