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It was a relief to the Dow Jones and the stock market at large when the White House and the Senate agreed on a deal regarding the coronavirus stimulus bill.
It was a mild relief on Wednesday for the stock market and the Dow Jones from a market crash after the White House and the Senate finally came into a common agreement regarding the coronavirus stimulus bill. The Dow Jones Industrial Average jumped over 11%, which reciprocated to over 2,000 points. On the other hand, the S&P 500 jumped over 300 points, while the NASDAQ 100 Index jumped 7.81% at the time of writing.
The deal, which involves $2 trillion, will go a long way in combating the devastating effect of coronavirus both into people’s life and also into the business world. Although the final draft on the bill has not been released to the public, the earlier draft gave directions that every individual should receive $1200, $2,400 for a married couple, and $500 per child.
In addition, the bill stipulates that $350 billion will go into small businesses to assist them with payroll and also prevent any layoffs. A further $150 billion will be sent to states that are hard hit by the pandemic.
The president was optimistic that the package will go a long way in helping hard-hit citizens by the coronavirus and in turn shield the stock market from collapsing further. Trump said:
“We are working to pass the biggest and boldest financial relief package in American history.”
Although a relief at the moment to the companies greatly assisted by the fund, it remains unclear if the government will claim a share of companies’ cake once the pandemic is over.
In response to this concern, Boeing Co (NYSE: BA) CEO David Calhoun said that if by any chance the government forces an equity stake, then we will have to look for other options. He stated:
“We got plenty of options. It’s just not ideal for us, our customers, and all those companies spread throughout the United States.”
Are Bad Days Over for Stock Market as Coronavirus Stimulus Bill Is Approved?
Well, this is a debate that is hotly contested amongst different analysts. This is because there are a lot of uncertainties when it comes to the novel coronavirus. As the number of infected people and the death toll keeps on rising by the day, a dim future may be overlooking the financial market at large.
However, if the virus is tamed soonest and a vaccine or a cure is found before things get out of hand, the stimulus package will be a huge savior to the stock market. It will have shielded the market from a further decline that is being considered worse than the 2008 and 9/11 ones.