In this tough times, the Trump’s top economic advisor Larry Kudlow unveiled a gigantic $6 trillion stimulus package for U.S. that perpetuated the Dow futures to rise. But these gains didn’t last amid the frequent underlying concerns about the health of the economy under an uncertain threat of coronavirus.
The whole world is effected economically by the virus attack but the right measures taken at the right times by Donald Trump’s top economic adviser of unveiling the massive $6 trillion stimulus package elevated the Dow futures to gain.
On Tuesday, these gains rapidly faded as the stock market failed to move higher after a historic day for Dow Jones. Worryingly for Wall Street, there doesn’t appear to be a Plan B if the fiscal package doesn’t push stocks higher longer-term.
It happened first time in the history of stock market that after the largest single-day point rally of the Dow Jones, the stock market unsuccessful to extend the move overnight despite a brief spike.
This volatility in stock market is the shadow of an incredible $6 trillion stimulus package for the United States.
After Historic Rally Dow Futures Fall
All the three major U.S. stock futures indices popped up on Tuesday first and dropped in evening, after initially rallying in the wake of a multi-trillion-dollar stimulus announcement.
Oil price ticked up 2.5% above $24 a barrel, in the commodity sector, while gold continued its impressive rally with another 1.5% gain.
And surprisingly the major cryptocurrency bitcoin has found its feet again, and rallying 5% to around $6,800.
On Tuesday, President Trump’s top economic adviser Larry Kudlow unveiled the biggest emergency spending package in history to providing direct aid to the families, the loan insurance for small business and bailouts for the corporations, Kudlow announced the fund with the astonishing $6 trillion price-tag.
That bailout program by US of a $2 trillion and $4 trillion of lending power from the Fed. That’s a $6 trillion package in which Fed can’t act fully unless we pass phase 2 because of phase 2 contains the increase in the exchange stabilization fund, that is the equity piece for the Fed lending so that the U.S. government is the guarantor, not the Fed and so those two packages go together.
When, President Trump signs this package into law, the stock market will still have to deal with a declining economy.
That proposed by amount $3,000 for a family of four, is not going to undo the damage of losing your job for too long, even if it provides some financial security to the most of the citizens, who are at risk.
Now, there has more than 50,000 confirmed cases of Coronavirus cases in the U.S. and keep on spreading.
But president Trump seems optimistic about opening up the economy as soon as Easter Sunday, and ultimately it will be governors Newsom (California) and Cuomo (New York), who can lift the shelter-in-place orders.