Wall Street falls after surprise rise in jobless claims, stimulus impasse

In this news, we discuss the Wall Street falls after surprise rise in jobless claims, stimulus impasse.

(Reuters) – US stocks fell on Thursday as an unexpected rise in weekly jobless job seekers heightened fears of a stalled economic recovery, amid lower hopes for aid additional budget before the elections.

The state’s initial jobless claims stood at 898,000 seasonally adjusted for the week ended Oct. 10, up from 845,000 the week before, the Labor Department said Thursday. Economists polled by Reuters had forecast 825,000 candidates last week.

Another report showed manufacturing activity in New York State fell more than expected in October.

“The first round of stimulus is weak and we are currently seeing the effects. You see vacation time turning into full unemployment numbers, ”said Brian Walsh Jr., senior financial advisor at Walsh & Nicholson Financial Group.

A day after Treasury Secretary Steven Mnuchin said a deal on increased federal aid was unlikely before the November 3 presidential election, President Donald Trump said there was still a chance.

Wall Street indices fell for the third day in a row, with the S&P 500 now nearly 4% below its intraday high reached on September 2, after rising to less than 1% of that level earlier this week.

With less than 20 days of election day, Trump and Democratic challenger Joe Biden will hold prime-time city halls on Thursday instead of their second presidential debate, which was canceled after Trump refused to participate in a virtual match.

The focus is also on the quarterly results dashboard for U.S. companies, with expectations for third quarter earnings improving to an 18.8% drop from an expected 25.0% drop. on July 1, according to data from Refinitiv IBES.

Morgan Stanley edged up 0.6% after beating third-quarter earnings guidance, ending mixed results from major US lenders. Profit reports saw those focused on trading registering big gains as retail banks were hit by the COVID-19 pandemic.

All major sectors of the S&P were down, with energy stocks falling 1.1% as oil prices fell more than 2% amid concerns about recovering demand. [O/R] At 10:51 a.m. ET, the Dow Jones Industrial Average was down 243.51 points, or 0.85%, to 28,270.49, the S&P 500 was down 34.60 points, or 0.99%, at 3,454.07. The Nasdaq Composite lost 166.55 points, or 1.42%, to 11,602.18.

Walgreens Boots Alliance Inc gained 3%, with the drugstore chain forecasting single-digit growth in 2021 after posting better-than-expected earnings in the fourth quarter.

The S&P 1500 Airlines Index fell 2.3%, with United Airlines reporting a 78% drop in quarterly revenue.

Shares of drug developer Vertex Pharmaceuticals Inc fell 19.2% after its trial to treat protein deficiency disorders was terminated.

The declining issues outnumbered the proponents for a 3.00 to 1 ratio on the NYSE and a 2.82 to 1 ratio on the Nasdaq.

The S&P Index recorded a new 52-week high and no new low, while the Nasdaq recorded 22 new highs and 23 new lows.

Report by Medha Singh and Shivani Kumaresan in Bengaluru; Edited by Shounak Dasgupta

Original © Thomson Reuters

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