Stocks were again uncertain on Thursday as the policymakers of the United States and Europe are taking some measuring steps to offset the very high decline of the economies.
Despite the 3% fall from the S&P 500 earlier, they have made a climb earlier. Some shares not only in the US but in Europe also recovered. Oil prices which fell 20% off on Wednesday gained back a little on Thursday.
This unexpected rise and fall of stocks all over the world on Wednesday are due to the pandemic of coronavirus that has continued to spread all over the world.
President Trump talked about it during a White House briefing and said that there would be a big decline before the economy would climb back again. He also wants to speed up the approval of some treatments which may help for the COVID-19.
The President said, “I believe in the V curve. When this is defeated, this hidden scourge is defeated, I think we’re going to go up very rapidly.”
In the country, the number of workers who are filing for unemployment insurance increase rapidly according to figures from the government.
281,000 have filed first-time claims as compared to 211,000 one week ago.
It doesn’t reflect yet the sharp cut that a lot of companies are doing to downscale the operations of their business as their means of keeping their consumers staying at home. Some factories have been closed as well.
On Wednesday night, the European Central Bank proposed a huge bond-buying program that will aid in the prevention of economic calamity and the Fed also proposed to support the funds of the money market.
These are threats where cash is needed. The Bank of England on Thursday recently announced that it will lower its benchmark interest rate to 0.1% and increase UK government bonds and other corporate bonds.
Just on Thursday, The Treasury Secretary, Steven Mnuchin announced that the economic plan of the White House would include sending $1,000 to every American adult and $500 per child within 3 weeks.
If this global crisis would continue, another check would be sent to the citizens again next month, all of the same amounts.
Also, on the same day, Ford Motor announced that it will suspend its dividend payment and draw $15 billion from the lines of credit to help the offset of the production which was caused by the coronavirus pandemic.
The company is one of the latest ones to help cushion the economy.
Patrick Anderson, an economist in East Lansing, Michigan said “This is a body blow to the economy, unlike anything we’ve experienced in recent memory. Even the Great Recession did not include the shuttering of businesses by government order at the same time that people were being told to stay home and distance themselves.”
Some economists said that there have been some predictions about the job market but it didn’t expect that the unemployment rate will increase quickly and surpass eventually a high level of 10%.