U.S. markets and stock exchange traded funds rebounded Tuesday after suffering its steepest decline since Black Monday 1987, as the Federal Reserve engaged more aggressive measures to bolster liquidity and the Trump administration spitballed additional stimulus measures.

On Tuesday, the Invesco QQQ Trust (NASDAQ: QQQ) increased 4.9%, SPDR Dow Jones Industrial Average ETF (NYSEArca: DIA) rose 1.9%, and SPDR S&P 500 ETF (NYSEArca: SPY) gained 2.8%.

The Fed revealed it would start a lending facility to support short-term commercial debt markets, reassuring companies that there will be enough short-term funds, which should provide banks with enough confidence to lend longer-term, the Wall Street Journal reports.

“The story of the day is the Fed responding to the funding tightness in the credit markets and restarting their commercial paper facility,” David Joy, chief market strategist at Ameriprise Financial, told the WSJ. “That really has seemed to alleviate a lot of the pressure in the markets, both in the funding markets, short term credit, as well as equities.”

The central bank’s restart of financial-crisis purchases of short-term debt follows other emergency measures already taken, including cutting interest rates to near zero, which sent the main indices plummeting 12% on Monday due to concerns that the Fed may have little options left if conditions were to worsen.

Further adding to the optimism that the government is actively pursuing fiscal stimulus as a means to prop up the economy, U.S. Treasury Secretary Steven Mnuchin outlined a stimulus package of about $850 billion.

“The reason why we’re seeing volatility is because we do need the double-barrel shotgun here,” Diane Jaffee, senior portfolio manager at TCW for the relative value equities team, told the WSJ. “We need not just monetary policy but we need fiscal response.”

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