The benchmark S&P/ASX200 finished 5.83 per cent higher on Tuesday afternoon, reversing around half of the damage done during Monday’s disastrous trading session and marking the best day for the index since 1997.
It closed at 5,293.40 points, a gain of 291.4 points. The broader All Ordinaries finished 5.53 per cent higher at 5,337.90 points.
All four major banks finished in the green, while BHP and Rio Tinto also finished higher. Grocery companies Woolworths and Metcash - which supplies IGA - finishing up 9.7 per cent and 27 per cent respectively.
These gains represented their largest gains since joining the ASX in 1993 and 1994.
The strong performance came as NSW announced its $2.3 billion stimulus package and the federal government teased more details, seeing the ASX200 lift 2 per cent at the opening of trade.
Premier Gladys Berejiklian said the state government is pursuing a “no regrets” policy, pushing $700 million into healthcare and $1.6 billion into job creation and tax relief.
"Our approach in relation to dollars in NSW will be first and foremost to save lives. I don't ever want to look back and think we should have done more," Berejiklian said on Tuesday.
"I don't want to look back and say, 'Why didn't we give Health what they asked for?" So the Treasurer went to Health and asked what they need.
"I want a no-regrets policy."
The Western Australian government on Monday announced its $607 million state stimulus package. That package includes a temporary freeze on household fees and charges, which means there will be no increases to things like electricity and water charges, and car licenses and registration fees. That also means public transport fares won’t increase.
The government will also increase the energy assistance payment to $600, while all public sector workers in the state will receive 20 days paid Covid-19 leave.
Second national stimulus package announced
Cormann shared details of the upcoming second stimulus package, after the government’s first $17.6 billion largely fell flat.
"We're looking at some pretty significant options that we would never have considered in the past," he told the Seven Network on Tuesday.
"We are working our way through that as we speak."
He said the hospitality and tourism sectors are among the hardest hit. Qantas on Tuesday morning announced it would cut 90 per cent of its international flights and 60 per cent of its domestic services.
Cormann, Prime Minister Scott Morrison and Treasurer Josh Frydenberg on Monday met to consult on further measures, amid complaints the $17.6 billion package and its $750 individual boosts didn’t go far enough.
Newspoll results released today indicated 75 per cent of Australians support the government's decision to favour economic stimulus over a budget surplus, as the coronavirus pandemic continues.
Global stocks plummet
It comes as global stocks shuddered lower on Monday, with Wall Street seeing its biggest one-day drop since 1987.
The S&P 500 fell 12 per cent in its biggest fall since “Black Monday”. This was despite the Federal Reserve taking drastic measures to boost the economy, cutting the interest rates to near zero.
Locally, Australian stocks also suffered. The benchmark S&P/ASX200 finished 9.7 per cent lower on Monday, a worse fall than the 8.3 per cent fall on 10 October 2008 and taking the index to levels last seen in April 2016.
The ASX200 has shed 30.5 per cent of its value since 20 February.
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