Wall Street retreats on surging COVID-19 cases, rise in jobless claims

(Reuters) – Wall Street’s main indexes edged lower on Thursday as soaring coronavirus cases and an unexpected rise in weekly jobless claims raised fears of stalling growth in the world’s largest economy.

FILE PHOTO: The New York Stock Exchange is pictured in the Manhattan borough of New York City, New York, U.S., November 10, 2020. REUTERS/Carlo Allegri

Initial claims for state unemployment benefits totaled a seasonally adjusted 742,000 for the week ended Nov. 14, compared with 711,000 in the prior week, the Labor Department said. Economists polled by Reuters had forecast 707,000 applications.

“What was a decline in jobless claims numbers for the last couple of months has suddenly reversed course, so that only plays into the current theme of the economy getting worse,” said Kenny Polcari, managing partner at Kace Capital Advisors in Florida.

The S&P 500 index was set for its third straight session of losses, retreating further from its record closing high hit on Monday following positive data on a coronavirus vaccine.

Investors have also become wary of the near-term damage caused by tightening business restrictions as COVID-19 cases continue to climb and in the absence of fresh stimulus measures.

“Stimulus will be the key,” said Joe Saluzzi, co-manager of trading at Themis Trading in New Jersey.

“Even a smaller package, half a trillion, will be well received and that’s the right trick to keep certain businesses open and keep people paying their rent before the vaccine starts coming in.”

Market participants are now looking to the Federal Reserve for signs it could step in with fresh monetary stimulus.

At 9:37 a.m. ET, the Dow Jones Industrial Average was down 125.41 points, or 0.43%, at 29,313.01, the S&P 500 was down 13.88 points, or 0.39%, at 3,553.91, and the Nasdaq Composite was down 18.00 points, or 0.15%, at 11,783.61.

All of the 11 major S&P indexes were down, led by the energy and financial sectors.

Value stocks, which include banks and industrials, slipped 0.5% as investors preferred the relative safety of growth-linked sectors such as technology.

L Brands Inc surged 13.1% after posting better-than-expected quarterly results, helped by record sales growth at Bath & Body Works and higher demand for Victoria’s Secret lingerie.

Department store operator Macy’s Inc fell 7.7% after it reported a more than 20% fall in third-quarter comparable sales.

Nvidia Corp slipped 0.7% after company executives said data center chip sales would fall slightly in the fourth quarter.

Declining issues outnumbered advancers 1.69-to-1 on the NYSE and 1.03-to-1 on the Nasdaq.

The S&P index recorded one new 52-week high and no new low, while the Nasdaq recorded 20 new highs and three new lows.

Source: Read Full Article