Major US stocks are trading mixed on Tuesday amid investors fears that interest rate cuts may not be enough to protect the world’s largest economy from the effects of the coronavirus epidemic.
The Federal Reserve suddenly cut its key rate on Tuesday to protect the world’s largest economy from the effects of the coronavirus epidemic. The rate was reduced immediately by 50 basis points to the target range of 1.00-1.25% per annum.
“The Fed has panicked … and that was a mistake,” said Michael O’Rourke of Jones Trading.
“Reducing the Fed rate by 50 basis points will now not force people to go to the movies or conferences, sporting events or any large gatherings,” he added.
The Dow Jones Industrial Average rose 0.17% to 19.00 GMT, the S&P 500 rose 0.46%, and the Nasdaq Composite rose 0.51%.
G7 finance ministers and central bank governors agreed to “do everything possible” to limit the damage from the rapidly spreading coronavirus, US Treasury Secretary Stephen Mnuchin said on Tuesday.