U.S. stocks extend relief rally after Senate approves historic stimulus bill.
The Dow and broader U.S. stock market continued to climb on Thursday after Senate lawmakers approved a $2 trillion stimulus bill.
All of Wall Street’s major indices finished in positive territory. The Dow Jones Industrial Average (DIA) gained 1,351.62 points, or 6.4%, to 22,552.17. The large-cap S&P 500 Index (SPY) rallied 6.2% to close at 2,630.07. Meanwhile, the technology-focused Nasdaq Composite Index (QQQ) shot up 5.6% to settle at 7,797.54.
The Chicago Board Options Exchange (CBOE) Volatility Index, commonly known as the VIX, reached an intraday low of 57.66 on a scale of 1-100 where 20 represents the historic average. The so-called “investor fear index” would eventually settle down 4.5% at 61.05, which is three times higher than the median average.
Markets rallied after the Senate late on Wednesday approved a $2 trillion relief plan for the U.S. economy. The bill aims to provide direct payments to Americans and loans for large and small enterprises. The bill will make its way to the House on Friday.
In data, U.S. jobless claims surged to record highs last week — the first tangible sign that the coronavirus pandemic was impacting the economy.
The number of Americans filing for first-time unemployment benefits shot up to 3.28 million, the Labor Department reported Thursday. Analysts in a median estimate were calling for 1.5 million new claims.
The Final Word: The United States economy is likely headed for a recession, which is defined as back-to-back quarters of negative growth. Some analysts expect a quick rebound in the second half of the year as the economy recovers from the coronavirus pandemic.