Wall Street recovered a bit from Monday's record loss on news from the White House of a proposed stimulus, but analysts say the bears may still run rampant in the markets for some time.
The Dow Jones Industrial Average jumped 1,000 points Tuesday, a 5% gain after Monday’s 3,000 point fall.
The Standard & Poors 500 and NASDAQ indexes were both 6% higher. Major British, French and German indexes closed Tuesday with 3% gains.
The Trump administration’s $1 trillion economic stimulus package in reaction to the coronavirus pandemic — including direct cash payments to Americans — gave investors confidence that people will have cash to take care of emergencies and to spend again once the worst of the outbreak is over.
Treasury Secretary Steven Mnuchin also announced deferred tax payments for businesses and individuals.
But many analysts say such a boost in confidence is tempered by the unknown: How long will the outbreak last, where will it strike next, and will the administration’s response to such matters as virus testing improve as the White House promises.
With Monday’s 3,000 point plummet and Tuesday’s 1,000 point gain, the experts say investors should expect a see-saw market for the near future.