NEW YORK (Reuters) – The Dow and S&P 500 dipped while the Nasdaq was modestly higher on Thursday as investors looked for signs of progress in fiscal stimulus talks to buttress the economy after labor market data showed a jump in jobless claims.
Major averages opened lower on the heels of weekly initial jobless claims data that spiked by 137,000 to a seasonally adjusted 853,000, well above expectations for 725,000 and the highest level since mid-September, underscoring the need for fresh stimulus measures to support a flagging economy.
But stocks moved well off their earlier lows after U.S. Treasury Secretary Steven Mnuchin said talks between Republican and Democratic senators on COVID-19 relief were making “a lot of progress” with more discussions expected in the day.
“We are in a bit of a trough, we’ve hit a valley right now and it’s all based on accelerating through this,” said Phil Blancato, CEO of Ladenburg Thalmann Asset Management in New York.
“We need that announcement, without that announcement we are going to have volatility through the end of the year, without a doubt.”
Graphic: Jobless claims –
The Dow Jones Industrial Average fell 116.47 points, or 0.39%, to 29,952.34, the S&P 500 lost 9.5 points, or 0.26%, to 3,663.32 and the Nasdaq Composite added 43.15 points, or 0.35%, to 12,382.10.
Airbnb Inc’s shares opened at $146 in their debut, far above the initial public offering (IPO) price of $68 apiece, raising $3.5 billion for the home rental firm. The offering comes on the heels of a blowout debut for Wednesday’s high profile IPO DoorDash.
The S&P energy index hit a six-month high as Brent crude prices surged above $50 a barrel for the first time since early March. The group has surged about 35% this quarter, the best performing of the 11 major S&P sectors, as investors have looked to names that could benefit from an economic reopening.
The faltering labor market recovery and the recent surge in COVID-19 infections have piled pressure on policymakers to come up with another rescue package, as most of the government financial aid for Americans and businesses has dried up.
The U.S. Senate was expected as early as Thursday to extend government funding by one week to give lawmakers time to work out a larger spending package and coronavirus relief, but House Speaker Nancy Pelosi raised the possibility talks could drag on through Christmas.
Also in focus was a meeting of outside advisers to the U.S. Food and Drug Administration (FDA) later in the day, to decide whether to recommend that the agency authorize Pfizer Inc’s COVID-19 vaccine for emergency use.
Some officials said vaccinations could begin as soon as this weekend if the FDA consented.
Declining issues outnumbered advancing ones on the NYSE by a 1.08-to-1 ratio; on Nasdaq, a 1.16-to-1 ratio favored advancers.
The S&P 500 posted 10 new 52-week highs and no new lows; the Nasdaq Composite recorded 122 new highs and 10 new lows.
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