On Oct 6, in a sudden turn of the event, President Donald Trump abruptly halted the ongoing negotiation between the Republicans and Democrats on the second round of fiscal stimulus. This unnerved market participants and stock markets immediately turned red from the positive zone.
The Dow, the S&P 500 and the Nasdaq Composite — lost 1.3%, 1.4% and 1.6%, respectively, despite the fact that all these indexes were in the green just before Trump’s tweet. Investors remained highly concerned about the pace of the U.S. economic recovery.
Notably, the first trench of the fiscal stimulus — known as CARES Act — ended in July. Despite two months of prolonged negotiations, the U.S. Congress failed to reach an amicable solution related to the size and scope of a fresh round of coronavirus-aid.
Moreover, one of the primary reasons for Wall Street’s sharp downturn in September after a five-month-long rally is the