Thursday’s Stock Market Open: US Equities Fall As Another 2.4 Million File For Unemployment

Update: 12:05 p.m. EDT:

U.S. stocks incurred deeper losses as of noon Thursday.

The Dow Jones Industrial Average fell 88.6 points to 24,487.30, while the S&P 500 tumbled 20.86 points to 2,950.75 and the Nasdaq Composite Index dropped 72.21 points to 9,303.56.

In Europe markets finished in the red, as Britain’s FTSE-100 dropped 0.86%, while France’s CAC-40 sank 1.15% and Germany’s DAX fell 1.41%.

Sales of existing homes plunged by 17.8% month-to-month in April, and were 17.2% lower than in April 2019, said the National Association of Realtors.

“Certainly with the lock-down occurring from mid-March, and given the shakiness from the stock market in February, that hurt pending contracts, so now we are seeing an almost 20% decline in existing homes sales,” said Lawrence Yun, chief economist for the Realtors. “April activity will be down, but what we are hearing from Realtors is they are getting busy as governors are opening the economy.”

The Conference Board Leading Economic Index amounted to 98.8 in April, down 4.4% from March.

New York Federal Reserve Bank President John Williams said Thursday that the unemployment rate will get worse.

“What we don’t know is what the shape or timescale of the recovery will be,” he said. “It’s going to be some time before we have a clearer view of the effects on other industries, including autos, higher education, manufacturing, and professional services.”

Original story:

U.S. stocks opened lower on Thursday as traders were deluged with more gloomy economic data while U.S.-China tensions escalate.

The Dow Jones Industrial Average fell 36.68 points to 24,539.22, while the S&P 500 edged down 3.48 points to 2,968.13 and the Nasdaq Composite Index dropped 5.47 points to 9,370.31.

About 2.44 million Americans filed for unemployment benefits last week, the seventh consecutive week of decline. Over the past nine weeks, 38.6 million people have filed.

The Philadelphia Fed manufacturing index rose to minus-43.1 in May, up from minus-56.6 in April, which was a 40-year low.

The number of confirmed global cases of coronavirus has now surpassed 5 million and almost 330,000 people have died from the virus.

British pharmaceutical firm AstraZeneca Plc (AZN) received more than $1 billion in funding to develop a Covid-19 vaccine.

Tensions with China are worsening. On Wednesday, the U.S. Senate passed a bill that could lead to the delisting of Chinese companies from U.S. stock exchanges.

President Donald Trump then criticized the Chinese leadership on Twitter.

“China is on a massive disinformation campaign because they are desperate to have Sleepy Joe Biden win the presidential race so they can continue to rip-off the United States, as they have done for decades, until I came along,” Trump tweeted.

Trump also directly blamed China for spreading Covid-19. “It all comes from the top. They could have easily stopped the plague, but they didn’t” he wrote.

“Markets may be pricing in far too much complacency as the U.S.-China ‘phase one’ trade deal could be at risk,” said Stephen Innes, chief global market strategist at AxiCorp. “The pandemic and resulting acute economic downturn have made China’s trade commitment to the U.S. much more challenging to fulfill.”

“The broad market has taken some support from positive treatment and vaccine headlines as a complement to a generally more optimistic economic reopening,” LPL Research wrote Wednesday. “The incredible rally off the Mar. 23 lows continues for equities, with the S&P 500 Index now up more than 32% in 40 trading days.”

Overnight in Asia, markets finished lower. The Shanghai Composite dropped 0.55%; Hong Kong’s Hang Seng fell 0.49%; while Japan’s Nikkei-225 slipped 0.21%.

In Europe markets traded mixed, as Britain’s FTSE-100 edged up 0.06%, while France’s CAC-40 slipped 0.49% and Germany’s DAX fell 0.75%.

Crude oil futures gained 2.9% at $34.46 per barrel, Brent crude rose 3.16% at $36.88. Gold futures dropped 0.79%.

The euro rose 0.06% at $1.0986 while the pound sterling slipped 0.02% at $1.2235.