Investors’ faith grows amid global coronavirus crisis as FTSE 100 opens up 2% by 108 to 5,555 points after record day of trading on back of US Federal Reserve’s mammoth stimulus
- FTSE 100 rises 108 points or 2 per cent to 5,555 points in early trading today
- Traders now have rare semblance of optimism after weeks of financial carnage
- Stock markets in Asia also soared with Tokyo up 8% after Olympics postponed
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The FTSE 100 rose further today as it opened up more than 2 per cent after US politicians agreed a mammoth stimulus package in the fight against coronavirus.
The index of Britain’s biggest companies went up by 108 points to 5,555 points in early trading this morning, following its largest ever points gain yesterday.
Traders worldwide now have a rare semblance of optimism after weeks of carnage across global markets, with stock markets in Asia also soaring overnight.
While the deadly infection continues to spread, the eyes of investors fixed on Washington DC last night where politicians thrashed out an emergency bill worth as much as $2trillion (£1.7trillion) – around 10 per cent of US gross domestic product.
THIS WEEK: The FTSE posted a record points gain yesterday, before rising again today
PAST FORTNIGHT: The FTSE has started to recover some of its losses over the last two weeks
It comes after a record rise yesterday for the FTSE 100 which jumped 9 per cent, or 452.12 points, to 5446.01 – its largest ever points gain.
It was also the second biggest percentage gain for the index since a 9.8 per cent rise in November 2008 during the financial crisis.
Yesterday’s surge added £113billion to the value of Britain’s biggest companies.
However, the FTSE 100 index is still down 26 per cent from its value on February 24 – and analysts said that it was too early to call the end of the market rout.
A man walks past a board showing the 225-issue Nikkei Stock Average data in Tokyo today
The new measures in the US will put cash directly into the hands of Americans, provides grants to small businesses and hundreds of billions of dollars in loans for corporations including embattled airlines, while expanding unemployment benefits.
The unprecedented moves are part of a worldwide response to the rapid financial shock caused by the coronavirus outbreak, which has locked down countries including the US and brought the global economy to a juddering halt.
The prospect of a massive spending splurge, combined with the Federal Reserve’s pledge to essentially print as much cash is needed, sent Wall Street into overdrive yesterday, with the Dow seeing its biggest rise since 1933, while the S&P 500 enjoyed its best day in more than a decade.
And the gains spread into Asia, which rallied for a second straight day, with extra impetus later in the day coming from the news out of Washington.
People wearing face masks walk past a bank showing the Hong Kong Stock Exchange today
Tokyo ended 8 per cent higher, with investors there also relieved that the 2020 Olympics had been postponed rather than cancelled.
Hong Kong and Singapore put on more than 3 per cent and Shanghai was up more than 2 per cent, Sydney and Manila rallied more than 5 per cent and Seoul piled on more than 4 per cent.
Taipei added almost 4 per cent, while Mumbai, Bangkok and Wellington were also well up.
Adding to the more upbeat mood was the G7’s promise to do ‘whatever is necessary’.