Stocks tumble following Trump’s stimulus announcement

Stocks tumble following Trump’s stimulus announcement
Posted at 4:17 PM, Oct 06, 2020

Immediately following President Donald Trump’s decision to drop negotiations with House Democrats on a new stimulus deal, stocks dropped on Tuesday.

The Dow Jones Industrial Average, which was up several hundred points earlier in the day, closed down 375 points following the announcement.

The markets, which spent much of the summer rebounding after a sudden drop in value in March, have remained stagnant in recent weeks. In early September, the Dow Jones reached 29,000 points for the first since February. It appeared the Dow Jones Industrial Average was on its way to returning to pre-pandemic levels. But the Dow dropped in September, and closed at 27,772 on Tuesday.

Trump said that he will not resume negotiations with House Democrats until after next month’s election, which is four weeks from today.

Late last month, House Democrats passed a $2.2 trillion stimulus plan despite knowing it would not be entertained by the US Senate. The proposal still costs more than the White House has said it would like, but is down from the $3.4 trillion stimulus plan House Democrats passed back in May.

In addition to another set of $1,200 direct payments to millions of Americans, House Democrats propose using $225 million for education, more funding for the struggling airline industry, and $436 million for local governments. The set of proposals would also include a $600 per week unemployment supplement, which expired at the end of July.