Stocks finished sharply higher Tuesday after traders embraced the Federal Reserve's promised support for the struggling U.S. economy and were optimistic Congress could reach a stimulus bill to revive an economy stalled by the coronavirus pandemic.
The Dow Jones Industrial Average finished up 2,112 points, or 11.37%, to 20,704, for its biggest one-day percentage gain since 1933. The S&P 500 jumped 9.4% and the Nasdaq soared 8.1%.
Chevron slashed its capital spending plans and halted its share buyback while warning of a "material" coronavirus impact on its 2020 earnings.
Meanwhile, Reuters reported Tuesday that U.S. lawmakers were nearing agreement on a $61 billion rescue package for the aviation sector. It would include $25 billion in payroll grants for passenger airlines weathering a sharp falloff in travel demand amid rising coronavirus outbreaks, the news service reported.
U.S. stocks on Monday had received an initial boost after the Fed pledged to backstop the country's financial system. They slumped into the close after the Senate failed for a second day to pass a massive fiscal stimulus bill of nearly $2 trillion.
Sen. Chuck Schumer and Treasury Secretary Steven Mnuchin said minor differences remain on reaching a stimulus agreement, but they hope to have a deal Tuesday.
House Speaker Nancy Pelosi told CNBC there was "real optimism that we could get something done in the next few hours."
President Donald Trump on Monday called on Congress to pass the rescue bill. He said the legislative branch has no choice but to act in the face of massive economic disruptions caused by widespread lockdowns aimed at slowing the spread of coronavirus Covid-19.
He also said no decision has been made yet on whether to extend federal guidelines aimed at slowing the spread of the coronavirus after they expire at the end of March.
Trump said the U.S. would “open for business” sooner than many have predicted, adding the country “was not built to be shut down.”
“America will again and soon be open for business. Very soon,” Trump said at a news conference. “A lot sooner than three or four months.”
"My general feeling is that the selling pressure is about to run its course. I believe a lot of things are shaping up to redirect the trajectory of conversation and sentiment, such as the Fed's new stimulus measures and expectations of fiscal stimulus,” said David Bahnsen, chief investment officer of Bahnsen Group.
“I refuse to offer a short-term prognosis on what the market will do today, tonight, tomorrow or even the rest of the week. “
The number of confirmed global cases of the coronavirus has risen to 414,277, according to the Johns Hopkins Center for Systems Science and Engineering, and deaths increased to 18,557.
The U.S. has 51,524 cases of the virus and more than 620 people have died.
General Motors (GM) - Get Report scrapped its 2020 earnings guidance and said it would tap a standby credit facility for around $16 billion, citing the economic uncertainty linked to the coronavirus pandemic.