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Canada’s main stock market rallied on Tuesday, rebounding from an eight-year low the day before, as hopes rose that global stimulus measures will ease the economic impact of the coronavirus pandemic.

The Toronto Stock Exchange’s S&P/TSX composite index surged 11.96%, or 1,342.59 points, to 12,571.08, after hitting its lowest intraday level since October 2011 at 11,172.73 on Monday. Since peaking in February, the index has tumbled about 30%. Tuesday’s percentage gain for the Canadian index was its biggest since July 1979, based on Refinitiv Eikon data.

“I understand why clients and investors want to liquidate the portfolio ... because the speed and velocity of the moves are frightening,” said Barry Schwartz, a portfolio manager at Baskin Financial Services. “At the end of the day though, I am quite certain we will recover probably all of this within a year.”

Stocks on Wall Street also posted strong gains on Tuesday.

The Dow registered its biggest one-day percentage gain since 1933 on Tuesday after U.S. lawmakers said they were close to a deal for an economic rescue package, injecting a shot of optimism into markets reeling from the biggest selloff since the financial crisis.

A handful of Canadian legislators convened on Tuesday to give the government the power to inject billions of dollars in emergency cash to help individuals and businesses through the economic crunch caused by the new coronavirus outbreak.

The heavily weighted financial services sector rose 13.4%, while consumer discretionary shares were up 13.6%.

Shares of First Quantum Minerals Ltd. surged 41.9%, helped by higher prices for base and precious metals, including a near $70 jump in the price of gold .

Suncor Energy Inc. cut its 2020 production outlook and suspended share repurchases for the year following the decline in crude oil prices and due to the economic impact of the virus outbreak. Still, its shares rallied 13%.

Oil prices rose modestly on Tuesday, but settled off the day’s highs as the coronavirus pandemic’s heavy toll on demand offset hopes for a forthcoming $2 trillion U.S. economic relief package.

India, the world’s third largest oil consumer, ordered its 1.3 billion residents to stay home for three weeks as of Tuesday, the latest big fuel user to announce restrictions on social movement that have destroyed demand for gasoline and jet fuel worldwide.

The oil market has been hit by twin shocks. The unexpected price war between Saudi Arabia and Russia has unleashed a flood of supply while the pandemic is on track to cut fuel demand by at least 10% worldwide.

Brent futures rose 12 cents, or 0.4%, to settle at $27.15 a barrel. U.S. West Texas Intermediate (WTI) crude gained 65 cents, or 2.8%, to settle at $24.01.

“No one has a handle of how much the world will come to a halt,” said Edward Moya, senior market analyst at OANDA in New York. “It will probably be impossible for oil prices to continue to stabilize.”

Early in the session both Brent and WTI were trading up over 5%. U.S. gasoline futures, meanwhile, soared over 30% early day and closed up about 8%.

The Canadian dollar was little changed at about 1.45 to the U.S. dollar, or 68.97 U.S. cents. The currency, which last Thursday hit a four-year low at 1.4669, traded in a range of 1.4375 to 1.4532.

Canadian government bond yields rose across the curve in sympathy with U.S. Treasuries. The 10-year was up 3.7 basis points at 0.855%.

Financial markets rebounded sharply on Tuesday, with a measure of global equities headed for its biggest bounce since the crisis erupted a month ago, while the safe-haven dollar recoiled as investors welcomed unprecedented global stimulus efforts.

Investors hoped the U.S. Federal Reserve’s offer of unlimited bond-buying would help avert a global depression with the help of other rescue packages, though it was not expected by itself to mitigate the devastating impact of the coronavirus.

The Fed’s action had failed to persuade Wall Street on Monday, with losses of 2%-3% on major indexes. But the mood improved on Tuesday as other governments and central banks stepped in and Congress readied a $2 trillion stimulus package to limit the economic fallout from the fast-spreading pandemic.

U.S. gold futures climbed as much as 6.7% to $1,672.60 an ounce as the moves by the Fed and others eased the need for cash and slashed the demand for dollars.

“The Fed’s measures are unprecedented, and they have been extremely proactive in preventing this external shock from morphing into a wider funding crisis,” said Vasileios Gkionakis, head of FX strategy at Lombard Odier.

U.S. and European stocks jumped 6% or more and the dollar index, a basket of major trading currencies, slid.

MSCI’s gauge of stocks across the globe gained 7.00%, the largest single-day gain since equities tumbled from all-time highs a month ago.

The broad pan-European STOXX 600 index rose 8.40%, its strongest session since late-2008. The index is still down about 30% from a record peak hit in February.

German stocks jumped 11% and British blue chips added 9% as both bourses also posted their best sessions since the global financial crisis in 2008.

Europe’s so-called fear gauge fell to 52.53, its lowest in nearly two weeks, after spiking to 12-year highs earlier this month.

Emerging market stocks rose 6.04%.

On Wall Street, the Dow Jones Industrial Average rose 2,112.98 points, or 11.37%, to 20,704.91, the S&P 500 gained 209.93 points, or 9.38%, to 2,447.33 and the Nasdaq Composite added 557.18 points, or 8.12%, to 7,417.86.

The Fed also will expand its mandate to corporate and municipal bonds and backstop a series of other measures that analysts estimate will deliver more than $4 trillion in loans to non-financial firms.

Other countries unveiled their own measures. South Korea’s ravaged market climbed 8.6% after the government doubled a planned economic rescue package to 100 trillion won ($80 billion).

In China, mainland stocks posted their biggest gain in three weeks of almost 3%, while Japan’s Nikkei soared 7%, its biggest daily gain in four years.

Still, investors remained wary, as the number of coronavirus infections topped 350,000 and new infections brought in from abroad rose in China.

Business activity collapsed from Australia and Japan to Western Europe at a record pace in March, as measures to contain the coronavirus hammered the world economy, and Japan said it was postponing the Olympics.

IHS Markit’s flash composite Purchasing Managers’ Index (PMI) for the euro zone, seen as a good gauge of economic health, plummeted to a record low of 31.4 in March, in the biggest one-month fall since the survey began in 1998.

With no resolution to the pandemic and not enough visibility into the depth of the economic downturn, it’s too early to call the end to the market’s rout, said Joe Saluzzi, co-manager of trading at Themis Trading in Chatham, New Jersey.

“The answer is still, ‘you got to get it under control,’” Saluzzi said about the coronavirus. “Everybody keeps saying it’s going to get worse before it gets better, so the markets are going to remain choppy and volatile.”

The government and central bank financial support helped calm nerves in bond markets, where yields on two-year U.S. Treasuries hit their lowest since 2013.

The benchmark 10-year U.S. Treasury note fell 15/32 in price to yield 0.8148%.

Germany’s 10-year yield was up 2 basis points on the day at -0.36%, compared with a 4 bps rise before the purchasing managers index (PMI) releases, all small moves when compared to record lows hit at -0.90% earlier in March.

The impact of the virus on the global economy is evident in a series of growth forecast downgrades and advance readings of PMIs across the world’s biggest economies.

German activity plunged to the lowest since the 2009 crisis, driven by a record services contraction, while French activity hit all-time lows. Japan posted its biggest-ever services fall.

However, the prospect of massive Fed funding pushed the greenback 0.26% lower against rivals, off three-year peaks , falling against the yen and sliding 1% versus the euro.


This content appears as provided to The Globe by the originating wire service. It has not been edited by Globe staff.