© Reuters. FILE PHOTO: A sign is pictured on Wall Street in front of the New York Stock Exchange in New York City
By Medha Singh and Shivani Kumaresan
(Reuters) – US stocks fell Thursday as an unexpected surge in weekly jobless claims heightened fears of a stalled economic recovery a day after Treasury Secretary Steven Mnuchin dashed hopes for more pre-election tax aid.
Initial government unemployment benefit entitlements for the week ending October 10 were a seasonally adjusted 898,000, compared with 845,000 the previous week, the Labor Department said Thursday. Economists polled by Reuters had forecast 825,000 applications in the last week.
A separate report showed that manufacturing activity in New York State declined more sharply than expected in October.
Hopes for another round of tax aid to support the domestic economy added to the recent rally on Wall Street, pushing the S&P 500 and Nasdaq to 2% of their September 2 highs earlier this week.
"It's been kind of a roller coaster ride as the market seems to be mostly orienting itself towards the stalled economic stimulus package and concerns about fourth quarter earnings if we don't get additional boost after the vote," said Art Hogan, chief market strategist at National Securities in New York.
Less than 20 days before election day, President Donald Trump and Democratic challenger Joe Biden will host primetime duels on Thursday instead of their second presidential debate, which was canceled after Trump refused to participate in a virtual matchup.
The focus is also on the quarterly earnings scorecard for companies in America. Third quarter earnings expectations are improving to an 18.9% decline from a 25.0% forecast on July 1, according to Refinitiv IBES data.
Morgan Stanley (NYSE 🙂 rose 0.2% after reporting better-than-expected quarterly earnings that wound up top US lenders' results.
Walgreens Boots Alliance (NASDAQ 🙂 Inc rose 4.8% as the drugstore chain forecast single-digit profits in 2021 after posting better-than-expected profit in the fourth quarter.
All major S&P sectors were down and energy stocks were down 2.5% as oil prices fell 3% on concerns about a recovery in fuel demand. (OR)
At 9:42 a.m. CET, the S&P 500 fell 280.91 points, or 0.99%, to 28,233.09 and the S&P 500 fell 34.40 points, or 0.99%, to 3,454.27. The value fell 128.91 points, or 1.10%, to 11,639.82.
Stocks of drug developer Vertex Pharmaceuticals Inc (NASDAQ 🙂 fell 16.2% after abandoning attempts to treat protein-deficiency diseases.
With a ratio of 6.91 to 1 on the NYSE and a ratio of 5.08 to 1 on the Nasdaq, declining issues outnumbered them.
The S&P index did not make a new 52-week high or low, while the Nasdaq made nine new highs and 14 new lows.
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