Futures on U.S. financial markets reversed their free fall early Monday after the Federal Reserve signaled further intervention to help lessen the blow of the coronavirus pandemic on the economy.
The spike in premarket trading came after the Fed announced a series of additional measures to juice the economy. In a statement early Monday, the Fed said it would purchase Treasury securities and mortgage-backed securities “in the amounts needed to support smooth market functioning and effective transmission of monetary policy to broader financial conditions and the economy.”
The Fed has also pledged to slash interest rates and launch a short-term lending facility.
Late Sunday, Dow futures plummeted below the 5% limit-down threshold after bipartisan talks on a $1.8 trillion economic stimulus package broke down.