Wall Street caps best week since 1974 on latest Fed stunner

NEW YORK (AP) — Wall Street closed out its best week in 45 years on Thursday after the Federal Reserve launched its latest titanic effort to support the economy through the coronavirus outbreak.

The central bank announced programs to provide up to $2.3 trillion in loans to households, local governments and businesses as the country tips into what economists say may be the worst recession in decades. It’s the latest unprecedented move by the Fed, which has rushed to ensure cash gets to parts of the economy that need it after markets got snarled by a rush of investors pulling cash out of the system.

The stock market is not the economy, and that distinction has become even more clear this week. The S&P 500 rose 1.4% Thursday, the same day the government announced 6.6 million Americans applied for unemployment benefits last week as layoffs sweep the nation. For the week, the S&P 500 jumped 12.1%, its best performance since late 1974. Markets will be closed for Good Friday.

Stock investors are continuously looking ahead to where the economy will be a few months or more in the future. From mid-February through late March, they sent stocks down by a third on expectations that a steep recession was imminent, before the economy really began to crunch.

In the last few weeks, though, investors have sent the market back up nearly 25% following promises for massive aid from the Fed, other central banks and governments around the world, even as evidence piles up that the recession fears were prescient. This week, some investors have begun to look ahead to the economy possibly reopening amid signs the outbreak may be peaking or plateauing in several of the world’s hardest hit areas.

”The market is solely focused on the number of cases,” said Quincy Krosby, chief market strategist at Prudential Financial. “The...