Reaction underlines desire for fiscal action: analysts
by William Watts
U.S. stock-index futures fell sharply Sunday night following the Federal Reserve’s emergency decision to slash interest rates nearly to zero and buy $700 billion in Treasurys and mortgage-backed securities in an effort to quell financial market turmoil sparked by the global coronavirus pandemic.
“The Fed has thrown most its weight behind this move, offering almost everything it has to give, which raises the inevitable question — if this doesn’t work, what will?” said Seema Shah, chief strategist at Principal Global Investors. “The immediate negative reaction suggests markets are already worrying about that, and governments likely need to accelerate their fiscal action.”