Wall Street Rises on Latest Fed Rescue Program

Wall Street closed out the trading week on a high note on Thursday as the U.S. Federal Reserve unleashed another program designed to buoy local governments and businesses crushed by massive closures to stem the 🦠Coronavirus Outbreak.

The benchmark S&P 500 index posted it best weekly gain since 1974, in a holiday-shortened week, bolstered by early signs that the outbreak was hitting a peak as well as aggressive global stimulus.

Under the Fed’s $2.3 trillion package, the U.S. central bank said it would work with banks to offer four-year loans to companies of up to 10,000 employees and directly buy bonds of states and more populous counties and cities.

“Buying junk bonds, oh my god, pretty much unexpected, so a very strong open, and all the beaten-up names, including energy, they took off,” said Tim Ghriskey, chief investment strategist at Inverness Counsel in New York.

The financial index was up 5.19%, providing the biggest boost to the S&P 500, as banks rose sharply on the Fed’s backstop. J.P. Morgan rose 8.97%, leading gains on the Dow. Shares of the iBoxx High Yield Corporate Bond Fund climbed 6.55%.

That helped take the sting out of another tough report on the labor market, with weekly initial jobless claims topping the 6 million mark for a second straight week.

“Everyone is expecting really lousy earnings and really lousy economic data. It is all going to be focused on when does the rebound happen and what parts of the economy comes back the quickest,” said Ghriskey.

The defensive real estate and utilities sectors rose more than 4%.

The Dow Jones Industrial Average rose 285.8 points, or 1.22%, to 23,719.37, the S&P 500 gained 39.84 points, or 1.45%, to 2,789.82 and the Nasdaq Composite added 62.67 points, or 0.77%, to 8,153.58.

For the week, the Dow rose 12.7%, the S&P climbed 12.1% and the Nasdaq gained 10.6%.