Dow Jones Industrial Average futures rose 445 points in extended trading, implying anopening rally of morethan 525 points.
Futures contracts tied to the major U.S. stock indexes jumped Wednesday evening after the European CentralBank joined the Federal-Reserve in announcing a massivestimulus plan to help combat the impact the coronavirus.
S&P 500 and Nasdaqfutures also pointed to higher opens, though futurescontracts trading can change rapidly overnight. The SDPR S&P 500 ETF rose 0.17% in the afterhours session.
Futures swung higher after the ECB announced a new PandemicEmergency Purchase Programme that will be able to use €750 billion ($819 billion) to purchase securities to help support the Europeaneconomy.
The moves followed yet another violent day on Wall Street on Wednesday as investors swung back to pessimism after Tuesday’s 6% bounce.
The Dow dropped 1,338.46 points, or 6.3%, on Wednesday and clinched its first close below 20,000 since February 2017. The Dow was down more than 2,300 points at the lows of the session. The S&P 500 dropped 5.2% to 2,398.10 and closed nearly 30% below a record set last month as both indexessank further into bear markets.
A eye-watering spike in Treasury yields has also kept investors anxious. The 10-year Treasury rate rose 22 basis points to 1.18% on Wednesday following a rise of more than 30 basis points on Tuesday as it rebounds from record lows.
The spread of the coronavirus also led the New York Stock Exchange to on Wednesday announce that it will temporarily close its historic trading floor and move fully to electronictrading. The exchange said that two people tested positive for the disease at screenings it conducted this week.
All-electronic trading will begin on March 23 at the open, the exchange said.
Voicing investor fears about the virus, longtime hedge fund Bill Ackman joined CNBC on Wednesday to warn that the novel coronavirus will wreak destruction on financial markets and the U.S. economy without unprecedented action by the federalgovernment.
Ackman and scores of other economists and investors worry that the virus, and efforts to prevent its spread, could undermine U.S. manufacturing, exports and ultimately U.S. GDPgrowth.
The Pershing Square executive called upon President Donald Trump to start a “Spring Break” U.S. for one month and suspend all interest, rent and tax payments for the duration.
“We need to shut it down now… This is the only answer,” the billionaire investor said. “America will end as we know it. I’m sorry to say so, unless we take this option.”
Stocks moved off their lows toward the end of Wednesday’s session, however, after the Senate had enough votes to pass a bill expanding paidleave and unemployment benefits in response to the virus as part of what’s expected to be a whopping governmental response to avoid a downturn.
Senate Majority Leader Mitch McConnell said Wednesday he would vote for the plan despite what he called “real shortcomings.” With the urgent need to take action, “I do not believe we should let perfection be the enemy of something that will help even a subset of workers,” he said.
The White House is weighing a fiscal package of more than $1 trillion that includes directpayments to Americans and financialrelief to small businesses and the airline industry.
Wall Street has been on an unprecedented rollercoaster ride amid the coronavirus turmoil, with the S&P 500 swinging 4% or more in either direction for eight consecutive sessions.
