U.S. stocks increased dramatically on Monday as investors hoped that the Federal Reserve and other central banks would ease money in response to the slowdown in commerce generated by the coronavirus outbreak.
The Dow Jones Industrial Average closed up 5.09%.
The S&P 500 and Nasdaq composite also closed up, 4.61% and 4.49%, respectively.
Earlier on Monday, the Organization for Economic Cooperation and Development said that governments need to act swiftly to overcome the virus and its effects on the economy.
“Macroeconomic policy stimulus in the most exposed economies will help to restore confidence as the effects of the virus outbreak and supply-side disruptions fade. Low interest rates should help cushion demand,” the OECD stated.
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Federal Reserve Chairman Jerome Powell on Friday sought to reassure markets that the central bank would protect the economy from fears over the coronavirus outbreak, signaling that it would cut interest rates if needed.
Monday’s gains in the stock market pared losses from the past week amid fears that the spread of the coronavirus was accelerating. Losses from last week for the S&P 500 were the worst since the 2008 financial crisis.
Monday’s gains in the markets came as the Centers for Disease Control and Prevention announced that there are 43 confirmed coronavirus cases in the United States.
Washington state on Monday announced that there are six fatalities from the virus in the state. A state of emergency has been called for Washington’s King County, where there are five deaths.
Globally, there have been more than 3,000 deaths caused by the virus. South Korea on Monday confirmed nearly 600 new cases of the disease on Monday, bringing its number of cases to 4,335. In Italy, 18 more deaths have been reported as the number of infected exceeds 2,000. Canada has over 25 cases of the virus. In Mexico, there are five cases.
