After President Trump’s tweet about moving along with the COVID-19 Relief Negotiations, the major averages climbed to touch highs on Friday.
The Dow Jones rose by 150 points or 0.5% whereas S&P 500 increased by 0.8%. the Nasdaq Composite also climbed by 1.2%.
In terms of weekly advances, the Dow traded higher by 3.2% week to date, which could lead to the biggest one-week gain since August. The S&P 500 and Nasdaq have increased by 3.8% and 4.3%, respectively, for the week.
Trump’s comments came as a reaction when House Speaker Nancy Pelosi rejected the aid to U.S. airlines offered by Trump, demanding a bigger stimulus package.
Keith Buchanan, portfolio manager at GLOBALT, said, “Stimulus talks are really dictating the market action on a day-to-day basis,”. He further added that the recent comments by both sides suggest some progress being made towards negotiation, however, he pointed out that it was important to move quickly on the topic to “relieve the pressure that the economy is under.”
Even though the Federal Reserve and U.S. lawmakers have spent trillions of dollars including the open-ended bond-buying program and the $2.2 trillion package signed by Trump to offer unemployment benefits and direct payments to Americans, economic experts and the fed have prompted the government to release more relief to sustain economic recovery.
Commenting on these measures for the economy and the market, Carl Icahn, billionaire investor and chairman of Icahn Enterprises, said on Thursday night, “If you look at stock prices, I think some of them are ridiculously high but going short on them proves to be a very, very expensive operation. A lot of those stocks you believe are tremendously overpriced just keep going up. So basically, I think the stimulus is doing the trick.”