Veteran Wall St. trader: Fed gives stocks a ‘breath of fresh air’ but full market recovery may take some time

Veteran Wall Street trader Art Cashin told CNBC that the Federal Reserve’s big announcement Thursday is propelling stocks higher, but he warned that a full recovery from the coronavirus-driven sell-off will take some time…

“For now, the Fed coming in open-ended has given the market a breath of fresh air,” Cashin said on “Squawk Alley.” “We traders coming in this morning had … thought the market might begin flattening out here.”

“But we got a second breath from the Fed,” he added.

Before the stock market opened, the Fed unveiled details of its much-anticipated Main Street lending program and other initiatives, a total of $2.3 trillion in loans to help businesses and municipalities.

Cashin’s comments came as the U.S. stocks continued their rally, following Wednesday’s gains. The Dow Jones Industrial Average was up more than 400 points, or nearly 2%.

Blue chips appear poised to post their best weekly gains since 1938.

Cashin said he does not expect a so-called V-shaped — quick down, quick up — recovery on Wall Street.

A U-shaped or “probably even an L-shaped” recovery is more likely, Cashin contended, “because even if you open all the bars or restaurants or movie theaters, are people going to flock there if the disease is still around? So I think there will be some hesitancy.”

On the other hand, Cashin said a concrete announcement that a drug to treat COVID-19 would soon be available would contribute to a market rally “that would open your eyes greatly.”

His last appearance on CNBC was on the morning on Feb. 13. He was in a car accident that evening. He fractured his hip, and he has been undergoing rehab.

The director of UBS floor operations at the NYSE gave his first public comments on the stock market’s coronavirus-driven sell-off to CNBC’s Bob Pisani earlier this week.

When Cashin was injured in February, the Centers for Disease Control and Prevention had confirmed just the country’s 15th case of COVID-19. There are now more than 432,000.

At the time, Cashin advised investors to watch declines in freight shipments as a sign of possible economic contraction. He had correctly said that further spread of the virus could eventually become “a problem” for the markets and economy.

NYSE Floor

Cashin, whose Wall Street career began nearly 60 years ago, said he looks forward to the reopening of the New York Stock Exchange floor. The NYSE went to all-electronic trading on…

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