US Equities Drop As Jobless Claims Data Worries Traders – Serialpressit (News)

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U.S. stocks fell on Thursday on yet another disappointing unemployment claims report.

The Dow Jones Industrial Average dropped 353.51 points to 26,652.33, while the S&P 500 fell 40.36 points to 3,235.66 and the Nasdaq Composite Index tumbled 244.71 points to 10,461.42.

Market heavyweights Microsoft (MSFT) and Apple (AAPL) each dropped more than 4%.

Thursday’s volume on the New York Stock Exchange totaled 3.71 billion shares with 1,348 issues advancing, 124 setting new highs, and 1,650 declining, with nine stocks setting a new low .

Active movers were led by Milestone Pharmaceuticals Inc. (MIST), American Airlines (AAL) and Advanced Micro Devices Inc. (AMD) .

The Labor Department said on Thursday that 1.416 million people filed initial jobless claims last week. This marks the 18th consecutive week that initial claims topped 1 million.

Mohamed A. El-Erian, chief economic adviser at Allianz, said the data was “worse than expected and the first weekly increase since March.”

He added: “Less disappointing: Continuing claims at 16.2 million [versus] consensus expectations of 17.1 [million]. The overall message is that an economy able to recover well is stalling due to health concerns.”

“The surge of COVID cases in the Sun Belt and the stalling out of reopening activities in other states has seemingly caused another round of layoffs that has stymied the nascent labor market recovery,” said Thomas Simons, money market economist at Jefferies.

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Treasury Secretary Steven Mnuchin said the Republican COVID-19 relief plan will extend enhanced unemployment insurance “based on approximately 70% wage replacement.” Donald Trump also backed off on his demand for a payroll tax cut in the next stimulus bill.

In retaliation for the U.S closing its consulate in Houston, China may shut down an American consulate in Chengdu.

The S&P 500 index “is getting hit very hard as investors sell out of tech, a group that came into the [second quarter] reporting season with impossibly high expectations,” said Adam Crisafulli of Vital Knowledge. “Tech stocks were simply wildly overbought, overowned, and overvalued, and there probably wasn’t anything they could have done differently with earnings to spur further gains.”

Christopher Harvey, senior analyst at Wells Fargo Securities: “We are seeing growing similarities to the late 1990s. Overall, our intermediate-term worry is that a melt-up may destabilize the marketplace and easy come, easy go – i.e., as stocks aggressively discount easy [first half] comps but do not factor in political risks.”

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Overnight in Asia markets finished mixed, as China’s Shanghai Composite index slipped 0.24%; Japan’s Nikkei-225 was closed for a holiday; and Hong Kong’s Hang Seng Exchange gained 0.82%.

In Europe markets finished flattish, as Britain’s FTSE-100 edged up 0.07%, while France’s CAC-40 slipped 0.07% and Germany’s DAX edged down 0.01%.

Crude oil futures fell 1.43% at $41.30 per barrel, Brent crude gained 0.53% at $43.54. Gold futures rose 0.98%.

The yield on the 10-year Treasury fell 2.18% to 0.582% while yield on the 30-year Treasury dropped 3.1% to 1.249%.

The post Thursday’s Stock Market Close: US Equities Drop As Jobless Claims Data Worries Traders appeared first on International Business Times.

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