U.S. stocks fall after Fed pledges unlimited asset purchases
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E-mail Xinhua, March 24, 2020
NEW YORK, March 23 (Xinhua) -- U.S. stocks fell sharply in volatile trading on Monday even after the Federal Reserve announced extensive new measures to support the economy amid the COVID-19 crisis.
Around midday, the Dow Jones Industrial Average dipped 701.87 points, or 3.66 percent, to 18,442.27. The S&P 500 dropped 89.70 points, or 3.89 percent, to 2,215.22. The Nasdaq Composite Index decreased 154.23 points, or 2.24 percent, to 6,725.29.
The Dow traded more than 950 points lower at one point near midday.
All the 11 primary S&P 500 sectors declined, with energy down about 7 percent in midday trading, becoming the worst-performing group.
The Federal Reserve announced on Monday that it will purchase U.S. treasuries and agency mortgage-backed securities with no limit to help markets function more efficiently amid coronavirus uncertainty.
"The coronavirus pandemic is causing tremendous hardship across the United States and around the world," the Fed said in a statement Monday morning.
"While great uncertainty remains, it has become clear that our economy will face severe disruptions. Aggressive efforts must be taken across the public and private sectors to limit the losses to jobs and incomes and to promote a swift recovery once the disruptions abate," said the U.S. central bank.
Earlier this month, the Fed made an unprecedented second emergency rate cut over just a two-week period, bringing the benchmark rate to near zero. It also launched a massive quantitative easing program, pledging to boost its bond holdings by at least 700 billion U.S. dollars as a means to keep long rates down and provide liquidity into capital markets.
Wall Street finished the past week with massive losses as investors grappled with fears over potential economic damage by the coronavirus.
For the week ending March 20, the Dow shed 17.3 percent, the S&P 500 fell 14.98 percent and the Nasdaq lost 12.64 percent. The major averages had their worst weekly performances since the financial crisis in 2008. Enditem
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