Wall Street stocks jump despite record US jobless claims
Key American stock indexes opened higher on Thursday despite fresh jobs data revealing a worse than expected number of unemployment claims which has surged to over three million.
The Dow Jones Industrial Average was up 500 points, or over two percent during early trading. Both the S&P 500 and the Nasdaq Composite jumped more than one percent higher.
Earlier in the day, the US Labor Department announced that unemployment insurance claims had unprecedentedly soared to 3.28 million, more than double the expected 1.5 million. The number is much worse than during the Great Recession of 1982, when it reached 695,000.
Thursday’s trading marked the third consecutive positive opening for US stocks, which have been on a wild ride in recent weeks. The Dow Jones Industrial Average lost more than 20 percent compared to one month earlier and more than 15 percent in annual terms as the coronavirus outbreak continues to wreak havoc on the US and the global economy.
Negative US jobs data sent European markets down, with stocks in London, Paris and Frankfurt trading nearly one percent lower. Asian markets also fell earlier in the day, with Japan’s Nikkei plunging almost five percent and Hong Kong’s Hang Seng losing over one percent.
Wall Street’s optimism may be explained by the long-anticipated $2 trillion stimulus package due to be passed after the US Senate approved the bill late on Wednesday. The rescue legislation is now headed to the House of Representatives, with debates scheduled for Friday morning.
The economic relief plan includes direct payments to Americans as well as loans to businesses that were forced to close due to a nationwide lockdown in an effort to contain the coronavirus outbreak. Airlines, that were hit hard by flight bans, may receive around $25 billion in grants to pay their employee wages and benefits and additionally get equal checks for loans and loan guarantees.