By Geoffrey Smith
Investing.com — U.S. stock markets bounced sharply at the opening on Friday as participants took heart from announcements of more emergency support measures out of Europe to cushion the economic impact of the coronavirus pandemic.
The bounce also reflected a more sanguine assessment of central bank measures to unblock markets that had shown signs of increasing stress and vanishing liquidity during Thursday’s rout.
By 9:35 AM ET (1335 GMT), the was up 1,317 points or 6.2%, while the S&P 500 and the were both up 6.0%.
In addition to the Federal Reserve’s announcement of a $1.5 trillion liquidity injection late Thursday, the Chinese, Australian, Indonesian, Swedish and Norwegian central banks all announced further measures to stabilize local financial markets on Friday.
They were followed by even more dramatic announcements in Europe, as Germany pledged an unlimited credit facility through its state-owned development bank to companies that suffer cash-flow difficulties as a result of the outbreak. Meanwhile in Brussels, the European Commission signalled that it was ready to suspend its rules on fiscal deficits given the extraordinary circumstances.
In the U.S., House Speaker Nancy Pelosi told reporters late on Thursday that a deal with the Trump administration on a package of economic support measures was “near”. However, President Donald Trump’s Twitter feed indicated that there were still substantial differences between the administration and House Democrats over which measures should be deployed.
“If you want to get money into the hands of people quickly & efficiently, let them have the full money that they earned, APPROVE A PAYROLL TAX CUT until the end of the year, December 31,” Trump said. “Then you are doing something that is really meaningful. Only that will make a big difference!”
Trump had pushed back earlier in the week against Democrat proposals for expanded sick pay and unemployment benefits to be included in the package.
Among individual companies, Apple (NASDAQ:) stock rebounded 6.5% after saying all its stores in China were now open again. In addition, the Financial Times reported that the company had signed a multiyear deal with the world’s three biggest music labels regarding Apple Music’s access to their artists, who include Taylor Swift, Beyonce and Ed Sheeran.
Elsewhere, oil prices rebounded 4.2% but were off intraday highs after newswires reported Russian energy minister Alexander Novak as downplaying the chance of a new “OPEC+” deal to restrain output in the near term.
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