US stocks edged up Thursday, following the latest in a series of massive sell-offs spurred by the coronavirus pandemic the day before, and breaking a string of sessions characterised by convulsive stock swings.
The indices opened lower but rose by midmorning and largely stayed in positive territory. The S&P 500 stock index closed up 2.3 per cent., while the Nasdaq composite index rose 0.5 per cent. The Dow Jones Industrial Average was up 1 per cent, closing back over the psychologically significant 20,000-point mark, at 20,087.19.
The trading session followed the markets’ steep drop on Wednesday when the Dow closed down 6.3 per cent. The waves of selling in the past weeks had wiped out nearly all the gains since US President Donald Trump was inaugurated in January 2017 and had technically created a bear market.
Perhaps more significantly, the markets seemed to hold firm on Thursday during and after Trump’s participation at the daily White House coronavirus briefing despite his remarks blaming China for the pandemic that has infected more than 10,000 and killed more than 150 in the US. Wednesday’s sell-off was marked by a pronounced acceleration after that briefing concluded.
The price for US oil also jumped nearly 24 percent on Thursday for its best day on record, as West Texas Intermediate crude close at US$25.22 a barrel, starting to climb back from the recent massive losses.
US and European policymakers continued to devise plans to address the impact of the coronavirus. As an early sign of the outbreak’s economic impact in the US, workers filing first-time jobless claims surged to the highest number in 2½ years, US government data showed on Thursday.
The figure did not include the sharp cutbacks that have since taken place since the government ordered businesses to scale back operations or shut down entirely.
Earlier in Europe, the European Central Bank unveiled a huge bond-buying programme aimed at preventing economic disaster, but the measures failed to lift investors, who remain doubtful the relief packages will be enough to hold in check a possible global recession. Most European stock markets lost ground yesterday.
It was a similar story in Asia, as pessimism about global growth kept investors on edge. Hong Kong’s Hang Seng Index closed down 2.6 per cent.
The Shanghai Composite Index fell 1 per cent for a seventh consecutive day of declines. The index was around 3 per cent short of a bear-market level, remaining the only major market in the world that has not plunged into bear territory.
“The rapid spread of the Covid-19 virus beyond mainland China has set the global economy up for the worst growth downturn since the 2008–09 financial crisis,” said Nariman Behravesh, chief economist at IHS Markit.
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This article Coronavirus: US stocks edge up as governments scramble to contain virus and its economic fallout first appeared on South China Morning Post