Stocks may move to the downside in early trading on Thursday as traders get their first official look at the economic impact of the coronavirus pandemic. The major index futures are currently pointing to a lower open for the markets, with the Dow futures down by 174 points.
Early selling pressure may be generated following the release of a report from the Labor Department showing a record spike in first-time claims for unemployment benefits in the week ended March 21st.
The Labor Department said initial jobless claims skyrocketed to 3,283,000, an increase of 3,001,000 from the previous week’s revised level of 282,000.
Economists had expected jobless claims to spike to about 1.5 million from the 281,000 originally reported for the previous week.
With the record-breaking increase, the number of seasonally adjusted initial claims reached the highest level in the history of the seasonally adjusted series. The previous high was 695,000 in October of 1982.
While the jump in jobless claims was widely expected on Wall Street, the magnitude of the increase may still come as a shock to some investors.
Nonetheless, the negative sentiment may be partly offset by last night’s news that the Senate finally voted to approve a massive $2 trillion stimulus package in response to the coronavirus pandemic.
Shrugging off concerns among some Republican Senators about an expansion of unemployment benefits, the Senate eventually voted 96 to 0 in favor of the bill.
The bill now heads to the Democrat-controlled House, which will be under pressure to quickly send the legislation to President Donald Trump’s desk.
House Speaker Nancy Pelosi, D-Calif., said the House will take up the legislation on Friday with strong bipartisan support.
Stocks moved notably higher over the course of the trading session on Wednesday before giving back ground going into the close. The major averages pulled back sharply in late-day trading, with the tech-heavy Nasdaq sliding into negative territory.
The major averages subsequently finished the session mixed. While the Nasdaq fell 33.56 points or 0.5 percent to 7,384.30, the Dow surged up 495.64 points or 2.4 percent to 21,200.55 and the S&P 500 jumped 28.23 points or 1.2 percent to 2,475.56.
In overseas trading, stock markets across the Asia-Pacific region moved mostly lower during trading on Thursday. Japan’s Nikkei 225 Index plunged by 4.5 percent, while China’s Shanghai Composite Index fell by 0.6 percent.
The major European markets have also moved to the downside on the day. While the German DAX Index has tumble by 2.7 percent, the French CAC 40 Index is down by 2.4 percent and the U.K.’s FTSE 100 Index is down by 2.1 percent.
In commodities trading, crude oil futures are slumping $0.78 to $23.71 a barrel after rising $0.48 to $24.49 a barrel on Wednesday. Meanwhile, after tumbling $27.40 to $1,633.40 ounce in the previous session, gold futures are jumping $20.70 to $1,654.10 an ounce.
On the currency front, the U.S. dollar is trading at 109.67 yen compared to the 111.21 yen it fetched at the close of New York trading on Wednesday. Against the euro, the dollar is valued at $1.0943 compared to yesterday’s $1.0882.
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