Stocks drift up and down in tentative trading on Wall Street
NEW YORK -- Stocks are limping along in tentative morning trading on Wall Street Wednesday, as a historic, worldwide rally downshifts dramatically after just a day.
The S&P 500 was drifting between gains and losses in the first few minutes of trading, a day after packing a year's worth of gains into Tuesday on expectations that Washington was close to a $2 trillion deal to aid the economy. Tuesday's 11.4% gain for the Dow Jones Industrial Average was its biggest since 1933.
Congress and the White House did announce an agreement early Wednesday, with the Senate possibly voting on it in the afternoon. Investors were anxiously waiting for this kind of aid, which will help blunt the blow to the economy as businesses shut down to slow the spread of the coronavirus.
Even optimists say the package provides just the second leg of three that markets need to regain lasting confidence. The Federal Reserve and central banks are also offering tremendous support by cutting interest rates and supporting lending markets, but investors say they need to see the number of new infections peak before they can feel comfortable knowing how deep the looming economic downturn will be.
The number of known infections has leaped past 435,000 people worldwide, and more than 19,000 have died, according to Johns Hopkins University. Overall, more than 111,000 have recovered.
For most people, the new coronavirus causes mild or moderate symptoms, such as fever and cough that clear up in two to three weeks. For some, especially older adults and people with existing health problems, it can cause more severe illness, including pneumonia and death.
With widening swaths of the economy shutting down and layoffs mounting, economists are sure a steep drop-off is coming. What's unsure is how long it will last.
That uncertainty has led to wild swings in the stock market over the last month. The S&P 500's 9.8% surge Tuesday was bigger than the index's gains in nine of the last 20 years.
But the market has also had a couple days within the last few days that packed entire years' worth of losses, including two days down 10.4%.
The uncertainty has carried over even to trading within a certain day or a certain hour.
The S&P 500 was down 1.4%, as of 10 a.m. Eastern time. Within the first 30 minutes of trading it was up as much as 2.2% and down as much as 0.7%. The Dow was off 140 points, or 0.8%.
European markets initially jumped to strong gains, but they faded as the day progressed. Germany's DAX was down 0.8%, and the French CAC 40 was up the same amount.
Even earlier on Wednesday, Asian markets surged to big gains following the big U.S. day. Asia, Japan's Nikkei 225 jumped 8%, South Korea's Kospi rose 5.9% and the Hang Seng in Hong Kong gained 3.8%.
Treasury yields were holding relatively steady. The yield on the 10-year Treasury inched up to 0.82% from 0.81% late Tuesday, and the two-year yield slipped to 0.35% from 0.37%.