US stock markets bounce back

US stock markets bounce back

US stock markets have begun to bounce back from one of their worst weeks in a decade, with growth of almost 5 per cent.

The markets rallied on Wednesday with the Dow Jones up by 4.98 per cent and the S&P 500 up by 4.96 per cent.

Asia witnessed a similar performance with the Nikkei 225 Tokyo up by 3.88 per cent.

Article continues after advert

The growth follows one of the worst weeks in US stocks in a decade, with the S&P 500 losing some 9 per cent over seven days in the run up to Christmas.

Earlier this week the US Treasury Secretary sought to reassure investors amidst the downward trend, claiming he had spoken to the chief executives of six of the USA's largest banks who had confirmed they had "ample liquidity" to continue their operations.

Seeking to reassure investors, Steven Mnuchin said: "We continue to see strong economy growth in the US economy with robust activity from consumers and business."

Last week the Federal Reserve had increased interest rates again - to a range between 2.25 per cent and 2.5 per cent - despite pressure from US President Donald Trump who has described rates raises as "crazy".

Brett Ewing, chief market strategist at First Franklin Financial Services, Florida, told the BBC: "The market is extremely oversold where we left it [on Monday].

"You cannot make the assumption that this correction is over, but today's action is definitely a very positive signal."

The FTSE 100 was still in the red this morning at -0.52 per cent, but saw an increase on its loss of 2.5 per cent over the course of last week.