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March 25, 2020, 5:13 p.m. EDT

Dow logs first back-to-back gain in 7 weeks but stocks end off highs, as Sanders, others cast doubt on quick passage of coronavirus rescue bill

Sen. Bernie Sanders of Vermont says he would put a hold on the bill unless Republican senators drop their objections

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By Mark DeCambre, MarketWatch


AP
The rescue team

U.S. stocks on Wednesday finished well off their best levels and the Nasdaq turned negative in the final minutes of trade, as the passage of a $2 trillion economic rescue package appeared to hit a snag.

How did benchmarks perform?

The Dow Jones Industrial Average /zigman2/quotes/210598065/realtime DJIA +3.15% rose 495.64 points, or 2.4%, to settle at 21,200.55. The S&P 500 /zigman2/quotes/210599714/realtime SPX +2.62%  rose 28.23 points, or 1.2%, to end at 2,475.56. The Nasdaq Composite /zigman2/quotes/210598365/realtime COMP +2.06% turned negative, finishing down 33.56 points, or 0.5%, at 7,384.30.

The move for the Dow marked its first successive gains since Feb. 6, while the S&P 500 registered its first consecutive gains since the period ended Feb. 12.

From its recent records, the Dow is down 28.3% from its Feb. 12 closing peak, the S&P 500 was around 27% from its recent high, and the technology-heavy Nasdaq was off 25%.

What drove the market?

A quartet of Senators opposed aspects of the coronavirus bill, which appeared to cause the stock market to stumble badly in its final stage of trading on Wednesday.

Progress on a U.S. fiscal stimulus package has been credited with providing some lift to beaten-down stocks over the past two sessions, as investors have worried about the depth of the coming recession and the rising death toll from the world-wide coronavirus pandemic that has infected 425,000 people and killed more than 20,000, as of Wednesday .

However, late Wednesday, Sen. Bernie Sanders of Vermont, who is seeking the Democratic presidential nomination, said he would put a hold on the bill unless Republican senators dropped their objections. And Republican senators, including Ben Sasse of Nebraska, identified what they said may be an error in the bill involving unemployment benefits.

The Senate had planned to vote on the rescue bill later Wednesday, Senate Majority Leader Mitch McConnell said in remarks on the Senate floor. The Senator opposition casts some doubt on the quick passage of the important piece of legislation intended to aid workers and companies that will be hurt by extended closures to prevent the spread of the deadly infection.

The text of the bill hasn’t been released but it is expected to provide $1,200 direct payments to many Americans; offer more than $360 billion in loans to small businesses; and set up a $500 billion fund to lend to industries, cities and states. The package also would expand unemployment insurance, offer hundreds in billions worth of loans to both small and large businesses and extend additional resources to health-care providers, the Wall Street Journal reported.

“The coronavirus spread is intensifying in the US, but some optimism is growing that it could peak in a few weeks and right now traders are primarily focused on all this stimulus,” wrote Edward Moya, senior market analyst at Oanda in a Wednesday note.

However, some investors are expecting any rebound in the market to take some time to take shape.

“The earliest time frame for when you can expect a bounceback is in the fourth-quarter, but that presupposes the [epidemic] curve is on the right side. The problem is we don’t have the health angle perfectly worked out,” said Alicia Levine, chief strategist at BNY Mellon Investment Management, referring to hopes that the pace of the virus’ spread in the U.S. would start to slow.

Levine said uncertainty exists around the domestic trajectory of the coronavirus, which analysts say is closer to following the path of the worst-hit countries like Italy and Spain, instead of Asian economies like South Korea, which more successfully limited the spread of the virus.

/zigman2/quotes/210598065/realtime
US : Dow Jones Global
27,110.98
+829.16 +3.15%
Volume: 544.41M
June 5, 2020 5:07p
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/zigman2/quotes/210599714/realtime
US : S&P US
3,193.93
+81.58 +2.62%
Volume: 4.80B
June 5, 2020 5:07p
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/zigman2/quotes/210598365/realtime
US : U.S.: Nasdaq
9,814.08
+198.27 +2.06%
Volume: 6.12M
June 5, 2020 5:16p
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