NEW YORK/LONDON (Reuters) - Stock markets soared on Tuesday, with a gauge of global equities posting its biggest gain since the coronavirus roiled financial markets a month ago, as the U.S. Congress zoned in on a $2 trillion stimulus package to curb the pandemic’s economic toll.
Senate Majority Leader Mitch McConnell said a deal was “very close” for an aid package that investors hoped would turn around markets reeling from the biggest downturn since the global financial crisis more than a decade ago.
The market rally came a day after the U.S. Federal Reserve’s offer of unlimited bond-buying to help avert a global depression failed to persuade skittish investors, at least initially.
The mood improved on Tuesday, with U.S. gold futures climbing as much as 6.7% to $1,672.60 an ounce and the dollar halting its steady rise as the moves by the Fed and others eased the need for cash and slashed the demand for dollars.
The rally led some to suggest a rout that has trimmed U.S. and European equities by roughly 30% in the past month may be near an end.
“We’re seeing some signs that a bottoming is happening,” said Neel Shah, senior trader at Peak6 Capital Management. “The next big step is the Senate passing the stimulus bill.”
U.S. and European stocks jumped 6% or more and the dollar index, a basket of major trading currencies, slid.
MSCI’s gauge of stocks across the globe gained 8.39%, the largest single-day gain since equities tumbled from all-time highs a month ago and since the height of the global financial crisis in October 2008.
The broad pan-European STOXX 600 index rose 8.40%, its strongest session since late-2008. The index is still down about 30% from a record peak hit in February.
