Dow jumps nearly 310 points to cap off a crazy week
Aug 16, 2019, 2:52 PM | Updated: 2:58 pm
(CNN) — The Dow shot higher by nearly 307 points Friday, as investors capped off a wild week for Wall Street on a high note.
US stocks rose after bond yields edged up and Europe and China announced plans for additional stimulus to shore up their economies in the wake of a global trade war. The Dow finished the day with a 1.3% gain. The S&P 500 rose 1.4% and the Nasdaq was up 1.7%
China’s National Development and Reform Commission said Friday it will boost stimulus to shore up the country’s economy, stabilize employment and give people more disposable income. Although China didn’t elaborate further, that was enough to soothe investors’ fears about the trade war’s harm to the global economy.
China’s announcement followed Hong Kong’s $19 billion stimulus package, unveiled Thursday, designed to avert a recession in the wake of crippling protests.
A European Central Bank official said late Thursday that it will announce substantial stimulus measures next month. The ECB previously hinted its plans, but Finland’s Central Bank Governor Ollie Rehn told the Wall Street Journal that the boost will be better than investors anticipate, adding that a big, bold plan will be more effective than a series of smaller moves.
This week has given investors whiplash. Despite gains on Tuesday and the past two days, the Dow still fell 1.5% for the week The Nasdaq and S&P 500 were down 0.8% and 1% respectively. All three indexes have fallen for three straight weeks.
CNN Business’ Fear and Greed Index continues to show investors are motivated by “extreme fear.”
The Dow closed 100 points higher in a wacky session Thursday, as conflicting signals in the economy confused investors. Stocks were up and down all day.
Wednesday, stocks posted their worst day of the year. The Dow was down 800 points, and the broader S&P 500 fell 3%. The bond market flashed a recession warning, as the yield on the 10-year Treasury briefly fell below the yield on the 2-year Treasury. That rare scenario, called an inverted yield curve, has preceded every recession in the modern era.
Tuesday, stocks soared. The Dow rose nearly 400 points after the Trump administration delayed some tariffs on tech products. But the Dow fell 400 points Monday in an end-of-day rout as investors feared an escalation in the trade war.
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