Continuing talk that the US Congress was moving to a deal on a massive bailout/support package saw markets storm higher on Tuesday with the Dow up more than 2,100 points, or over 11% at the close.
In fact, all three main US stock indexes jumped by more than 8%, bouncing back from another brutal selloff on Monday as the virus outbreak forced entire nations to shut down.
The Dow surged 2,112.98 points, or 11.37%, to end at 20,704.91, while the S&P 500 closed around 209.93 points, or nearly 9.4% higher at 2,447.33. The Nasdaq closed up 557.18 points at 7,417.86, for a gain of 8.1%
The 9.3% rise in the benchmark S&P 500 was part of a global rally which saw the Europe-wide Stoxx 600 finish up 7.5%, London’s FTSE 100 end up 9%, Frankfurt’s DAX with an 11% gain, the ASX 200 with a 4.2% rise and looking to go as much again today and perhaps more if the US Congress nuts out a final bill approves it.
Just after 7.15 the ASX 200 futures was up 278 points, or around 7%.
Oil, gold, silver, copper and iron ore all rose, while the Aussie dollar ended over 59 US cents and 10-year US bonds were trading around a yield of 0.87% and Aussie 10 year bonds were at the same level.
The surge came from investors again hoping that the US Senate will pass a $US2 trillion ($A3.4 trillion) bill, aimed at providing financial aid to Americans out of work and help distressed industries.
There’s a separate proposal in the US House of Representatives to grant airlines and contractors a $US40 billion bailout which looks like its approaching agreement.
Tuesday saw the ASX 200 rising nearly 190 points or 4.2% to end at 4735.7 points as all sectors finished higher, led by energy with a 7.6% gain closely followed by real estate up 7.1%.
The gain partly recovered Monday’s nasty 5.6% slide.
The gain in energy stocks was led by a 20.6% surge in Santos’ shares after it revealed plans to chop Capex by 38% or $550 million this year. Shares in coal miner, New Hope rose 17.2% despite a weak interim profit and smaller dividend while Woodside shares enjoyed a rare rise of 5.6%.
The real estate sector was boosted by a 12% rise in Goodman Group securities and an 18% rise for GPT.
Credit Corp surged 46% after Monday’s startling slide, Corporate Travel jumped 31.3% to $7.56 and Afterpay Touch saw its shares end 26% higher at $11.21 after falling below $10 on Monday.
GrainCorp shares fell 31% after the United Malt demerger took place as of yesterday.
CSL lagged the rest of the market, closing 1.1% higher after being the star performer in Monday’s slump with a 4% gain.
The financial sector had a positive day, the inverse from Tuesday’s performance. Commonwealth Bank and ANZ rose more than 5%, Westpac was up more than 2% and the NAB gained3.75%. Macquarie Group shares jumped 11%.
The Australian dollar gained nearly 1% during the day to be at 59.10 US cents and was trading around that level in early Asian dealings on Wednesday.
In the Asian region, Japan’s stock market surged 7.3% after Softbank announced plans for a massive asset sale and share buy-back, while the Hang Seng was 4.6% higher.
According to Reuters, it was the Dow’s biggest one-day percentage gain since 1933 during the Great Depression.
