Dow Futures Drop 600 Points Amid Stimulus Uncertainty

By Noreen Burke 

Investing.com – U.S. stock futures pointed to a sharply lower open on Wednesday after strong gains in the previous session amid doubts over what U.S. President Donald Trump said would be “major” fiscal stimulus measures to counter the economic impact of coronavirus.

By 07:50 AM ET (1150 GMT), dropped 632 points, or around 2.5%. and were both down around 2.6%.

Wall Street reversed course on Tuesday, with the three main indexes pulling back from the brink of a bear market maid expectations that Trump would discuss a payroll tax cut and announce other stimulus measures at a news conference.

But while Trump met with fellow Republicans in the U.S. Senate on Tuesday, he did not outline any measures to offset the economic fallout from the virus outbreak.

Futures also remained lower after the Bank of England joined other central banks in cutting interest rates and announced measures to support bank lending in order to cushion the economy.

With the Federal Reserve having already cut rates this month, the pressure is on the European Central Bank to act when it meets on Thursday.

Benchmark were down 4 basis points to 0.713%, more than double Monday’s record low yield of 0.3180%.

Market participants largely expect the Fed to cut interest rates for the second time this month at the conclusion of next week’s regularly scheduled policy meeting, after it surprised investors last week with a 50-basis-point cut.

–Reuters contributed to this report

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