US stocks and oil prices rebounded Wednesday as the US government and several states unleashed fresh initiatives to combat the coronavirus fallout, including nearly $500 billion in federal stimulus.
The Dow Jones industrial average climbed as much as 475.73 points, or 2 percent, to 23,494.61 in early trading after shedding more than 1,200 points in the prior two days. The S&P 500 and Nasdaq composite also jumped as much as 2.1 and 2.2 percent, respectively, at the open.
The bounce came a day after the US Senate passed a new $484 billion stimulus bill to shore up small businesses and hospitals grappling with the coronavirus pandemic. Several southern states have also announced plans to reopen their economies as the outbreak begins to wane in the US.
“Positive developments in the fight against the coronavirus and new economic stimulus measures have led to renewed optimism,” said AxiCorp market analyst Milan Cutkovic. “Other countries are likely to follow [the US] with further measures to minimize the economic damage caused by the pandemic.”
The Wall Street rally accompanied a jump in oil prices, which dropped below zero for the first time ever earlier this week as the pandemic destroys demand for fuel and storage capacity dwindles. West Texas Intermediate crude futures were recently trading at $14.03 a barrel, a 40 percent jump from Tuesday’s close of $10.01.
The surge came after President Trump said he authorized the Navy to “destroy” Iranian gunboats that harass American vessels following reports of US ships being hounded by Iran. Oil prices similarly spiked in January after a US airstrike killed Iranian general Qassem Soleimani.
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