Dow claws back 1,049 points as Fed, Treasury move to restore investor confidence

NEW YORK - U.S. equity markets bounced back after the worst drop since 1987 as President Trump, the Federal Reserve and the U.S. Treasury Department made further moves to restore investor confidence.

RELATED: CoronavirusNOW.com, FOX launches national hub for COVID-19 news and updates.

The Dow Jones Industrial Average climbed over 1,045 points or over 5 percent. While the broader S&P 500 and tech-heavy Nasdaq Composite jumped around 6 percent.

On Tuesday, the Federal Reserve announced it was taking action to grease the wheels of the commercial paper market, which is critical for supporting the flow of credit to businesses and households.

Shortly afterward, Treasury Secretary Steve Mnuchin said the IRS would allow taxpayers to defer payments typically due on April 15 as the pandemic curbs incomes and keeps some workers from their jobs.

President Trump promised the nation "will win" its fight against the disease and the economy would return to levels "nobody has ever seen."

Tweeting: "The world is at war with a hidden enemy. WE WILL WIN!"

The upswing was a welcome break to investors after a broad selloff on Monday forced the blue-chip Dow Jones down more than 12 percent while the benchmark S&P 500 plunged nearly 30 percent below its Feb. 19 peak. The VIX, or fear index, soared to its highest level on record.

Looking at stocks, Regeneron soared after the company said it hopes to start clinical trials for a COVID-19 antibody treatment as early as this summer. Other companies working on treatments also rallied.

Boeing shares fell after a report that both the planemaker and the aviation sector as a whole were in talks for short-term government assistance. The heavily beaten-down airline sector was mixed.

Retail stocks were in focus after February sales dropped 0.4 percent from a year earlier, according to the Commerce Department, missing the 0.2 percent gain that economists surveyed by Refinitiv were expecting. Elsewhere in the space, Nordstrom announced the closure of all of its stores in the U.S. and Canada and pulled its 2020 outlook.

Macy's also announced it will close all stores, including Bloomingdale's.

Ravaged oil stocks traded mixed as West Texas Intermediate crude oil was slipped to the $27 per barrel level. Meanwhile, miners rallied as gold jumped to the $1,528 an ounce level.

Utilities led the charge higher, rising amid a flight to safety.

Elsewhere, a steepening yield curve lifted bank stocks as the spread between the 2-year yield at 0.51 percent and 10-year at 1.08 percent widened.

Blue-chip tech stocks Apple and Amazon spiked but Tesla fell.

In Europe, Britain’s FTSE rose 1.7 percent while Germany’s DAX and France’s CAC climbed 1.9 percent and 2.3 percent, respectively.

Markets were mixed across Asia with Hong Kong’s Hang Seng adding 0.8 percent, Japan’s Nikkei edging up 0.1 percent and China’s Shanghai Composite slipping 0.3 percent.

Get updates on this story from foxbusiness.com.