The New York Stock Exchange surged about 5% Wednesday after plunging from 8% to 9% in 4 sessions. Investors seem to have followed the advice of Donald Trump, who felt the current downfall was “a great opportunity to buy.” Traders were hunting for bargains after the heavy price losses of recent times, and upbeat figures about US consumer spending for the holiday season. Amazon reported record sales for the holiday season, which reminded markets that shopping remained strong in the United States, reducing the risk of a sharp slowdown in growth.
The market rebound was accompanied by oil, while the Trump administration wanted to calm the debate over a possible dismissal of Jerome Powell. Trump has expressed his confidence in the central bank and Powell, but remains critical of the policy of interest rate increases.
In a Christmas interview with the press on Tuesday from the White House, Donald Trump said the current stock market crash was a buying opportunity. “We have companies – the best in the world and they are doing very well,” he said. “They are posting record numbers, so I think it’s a great opportunity to buy, really a great opportunity to buy,” said the US president, noting the good health of his country’s economy.
At the close, the Dow Jones index returned Wednesday 4.99% to 22.878 points, while the broad S & P 500 index rebounded 4.96% to 2.467 pts, and the Nasdaq index, rich in technology and biotechnology stocks, soared 5.84% to 6.554 pts. Monday, the Christmas Eve, the S & P 500 had ended at its lowest level in 20 months, and was close to the “bear market”, while the Nasdaq fell by 23.6% compared to its record high and the DJIA suffered a 18.7% decline.
Oil prices showed exceptional movements. Brent oil went below 50 dollars for the first time in almost a year and a half, but later the price rose sharply. On the Nymex, the February futures contract on US light crude WTI rebounded 8.68% to $46.22 a barrel while North Sea (February contract) rose 7.93% to $54.47 per barrel. On Monday, both types of oil had dropped more than 6% with the WTI falling to the lowest in 18 months.