Stocks claw back early losses as stimulus comes into view

Stocks claw back early losses as stimulus comes into view
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Stock markets clawed back deep early losses on Thursday, closing in on positive territory as the government's plans for a major economic stimulus became more clear.

The Dow Jones industrial average closed at 20,087, up 188 points, or 1 percent, after falling more than 700 points in morning trading. On Wednesday, it closed below 20,000 for the first time since 2017.

The S&P 500 returned from a nearly 80-point drop to close up 11.3 points, or 0.5 percent, at 2,409.

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After hitting record highs in February, markets have seen wild daily swings, shedding roughly a third of their value as the coronavirus pandemic has begun to ravage the economy.

Unemployment insurance claims spiked by a third between the first and second weeks of March, reaching 281,000, and portending a significant spike in the weeks ahead. Institutions such as Bank of America and S&P Global predict that the U.S. has already entered a recession.

Congress and the Trump administration have pushed forward stimulus plans.

On Thursday, Treasury Secretary Steven MnuchinSteven Terner MnuchinLawmakers fear voter backlash over failure to reach COVID-19 relief deal United Airlines, unions call for six-month extension of government aid House Democrats plan to unveil bill next week to avert shutdown MORE confirmed plans to provide cash payments of $1,000 to every adult and $500 for every child, with the possibility of a second payment after six weeks. Congress is mulling raising the amount to $1,200, and scaling back the amount for higher earners.

Senate Majority Leader Mitch McConnellAddison (Mitch) Mitchell McConnellMomentum growing among Republicans for Supreme Court vote before Election Day Trump expects to nominate woman to replace Ginsburg next week Video of Lindsey Graham arguing against nominating a Supreme Court justice in an election year goes viral MORE (R-Ky.) outlined plans to provide business loans to help keep employees on the payrolls, as well as an emergency loan facility for critical industries.

President TrumpDonald John TrumpUS reimposes UN sanctions on Iran amid increasing tensions Jeff Flake: Republicans 'should hold the same position' on SCOTUS vacancy as 2016 Trump supporters chant 'Fill that seat' at North Carolina rally MORE also raised the possibility that medical experts could find an effective treatment for the COVID-19 in existing generic drugs. Early studies showed promise for an anti-malarial drug in scaling back the effects of the virus.