REUTERS / Brendan McDermid
- The major US stock indices eased on Monday, even after the Federal Reserve announced plans to further support economic activity in the face of the growing corona virus threat.
- The central bank's new programs include unlimited bond purchases and facilities to keep consumers and small businesses alive as the coronavirus pandemic drastically slows spending.
- Traders remained insecure as the Senate still failed to adopt a trillion dollar stimulus package.
- Monday's losses followed a limit down trading stop for US stock futures on Sunday evening.
- See how key indices are updated live.
The major US stock indices eased on Monday, even after the Federal Reserve announced plans to strengthen the economy.
The Fed promised to keep both Main Street and Wall Street afloat as the coronavirus pandemic hampers economic activity. The central bank raised its bond purchase limit and said it would create three facilities to strengthen lending to large employers and individual consumers.
Monday, open for US indices, followed a strong sell-off when futures trading started on Sunday evening. These contracts triggered a limit-down trade freeze after the Senate failed to agree on a trillion-dollar stimulus package. The Corona Virus Aid was postponed again on Monday afternoon.
The most important US indices stood at the market close on Monday:
The industrial average of Dow Jones wiped out the so-called Trump bump on Monday and fell to an intraday low of 18,213.65. This has wiped out all gains in the index since Donald Trump won the presidential election on November 8, 2016.
The Fed's recent monetary policy measure continues to lower the hurdle for companies looking for cheap credit, but tax relief is becoming more important as demand quickly subsides, Seema Shah, chief strategist at Principal Global Investors, said in an email to Markets Insider .
Congress is stuck in negotiations for an almost $ 2 trillion stimulus package, despite the Trump administration's call for such a law to be passed on Monday. The monetary easing will only keep companies alive for so long, Shah said, focusing on the government to help mitigate the downturn.
"Given the understandable reluctance of some companies to take on more debt in this difficult economic time, the US economy is still demanding that the US government provide economic support in a way that does not involve additional credit," she wrote, adding that all types of policy tools would be "quickly out of date" if the virus could not be contained effectively.
The S&P 500 was down nearly 5% on Friday as investors continued to wait for tax breaks from the White House and Congress. The decline ended the worst week in US stocks since 2008.
Read more about the market coverage of Markets Insider and Business Insider now:
Traders betting on stock declines made $ 344 billion in just one month when Coronavirus devastated the market
These 4 stunning graphs show how quickly the Corona virus outbreak decimated major US industries – and pushed the economy to the brink of recession
(tagsToTranslate) Wall Street (t) Market Settlement (t) Stock Exchange (t) Shares (t) Federal Reserve (t) Coronavirus (t) Coronavirus Aid Bill (t) s & p 500 (t) Dow Jones Industrial Average (t) Stock Turnover (t) Tax incentive (t) Nasdaq Composite (t) Equities (t) Rece