Stocks rise as Wall Street winds up a turbulent week

/ CBS/AP

Congress mulls massive coronavirus bailout

Stocks rose on Wall Street at the end of another turbulent week that witnessed punishing drops as investors weighed the economic impact of the widening coronavirus pandemic. On Friday, major market indices rose on the expectation for a fiscal stimulus that will aid American workers and businesses.

The Dow rose 82 points, or 0.4%, to 20,169.59 in early trading. The broad-based S&P 500 slipped 0.2% and the tech-heavy Nasdaq rose 1%.

Investors were encouraged after seeing more steps by the Federal Reserve and other central banks and governments to support credit markets and the economy. Hopes are rising that there will be progress in finding virus treatments and that "a boatload of stimulus by both central banks and governments will put the global economy in position for a U-shaped recovery," said Edward Moya of Oanda in a report.

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"The Fed made aggressive moves this past week including: cutting its policy rate by 100 [basis points] to the zero lower bound, announcing $700 [billion] of [quantitative easing] and activating several emergency facilities to support liquidity," wrote Bank of America analysts on Friday. "The recovery is likely to begin in [the second half of 2020] but the speed and magnitude will depend on the policy response."

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Wall Street has bounced up and down by record-setting margins of up to 12% over the past week. Unease has grown as forecasters say a global recession looks increasingly likely and have cut growth outlooks for the United States, China and other major economies.

Central banks across the globe are trying to reduce the impact of a global recession that forecasters say looks increasingly likely as the United States and other governments tighten travel controls, close businesses and tell consumers and travelers to stay home.

Investors also appeared to be encouraged by reports that China is set to ramp up stimulus spending after the province where the virus emerged in December showed no new infections on Wednesday.

The U.S. Federal Reserve unveiled measures Thursday to support money-market funds and the borrowing of dollars as investors in markets worldwide hurry to build up dollars and cash as insurance against falling asset prices.

That rush to gather dollars is straining markets, with sellers of even high-quality bonds struggling to find buyers at reasonable prices.

First published on March 20, 2020 / 10:12 AM

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