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Coronavirus stock Dow falls 200 points as jobless-claims figures show extent of coronavirus damage

Getty Images / Johannes Eisele US stocks rose on Thursday as investors reacted to another dismal jobless-claims report, paring earlier losses. Last week, 3 million Americans filed for unemployment, bringing the eight-week total to more than 36 million. A rally in bank stocks led the S&P 500 and the Dow Jones industrial average higher later…

Josephine Moon

Published on June 6, 2020

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Coronavirus stock

Getty Images / Johannes Eisele

US stocks rose on Thursday as investors reacted to another dismal jobless-claims report, paring earlier losses.
Last week, 3 million Americans filed for unemployment, bringing the eight-week total to more than 36 million.
A rally in bank stocks led the S&P 500 and the Dow Jones industrial average higher later in the day.
Geopolitical tensions escalated after President Donald Trump told Fox Business on Thursday that the US could “cut off” its relationship with China.
Read more on Business Insider.

US stocks rose on Thursday, paring earlier losses after the weekly jobless-claims report showed that unemployment remained elevated even as some states begin to reopen from coronavirus-related shutdowns.

All indexes slumped at market open when a report showed last week, 3 million Americans filed for unemployment, more than the consensus forecast from economists. That brought the eight-week total to more than 36 million, though it marked the sixth straight week of declines for the measure.

Later in the day, stocks pared nearly all of their earlier losses, sending the Dow Jones industrial average and the S&P 500 into positive territory. A rally in bank stocks led the rebound — Wells Fargo gained more than 7% while American Express jumped nearly 6%. In addition, JPMorgan rose nearly 4%, and Bank of America,and Citigroup gained more than 2%.

Here’s where US indexes stood at 2:25 p.m. ET on Thursday:

S&P 500: 2,828.18, up 0.29%
Dow Jones industrial average: 23,418.16, up 0.73% (170 points)
Nasdaq composite: 8,845.71, down 0.2%

“Although the initial deluge of unemployment claims is slowing, the labor market likely has further to fall as states chip away at backlogged claims and employers navigate reopening amid a continued health crisis,” Daniel Zhao, an economist at Glassdoor, told Business Insider. “We’re not out of the woods yet.”

The gains were a reversal of stock-market weakness on Wednesday. Major equity indexes dipped after Federal Reserve Chairman Jerome Powell said the US economy could be permanently damaged absent further government intervention.

House Democrats have proposed a $3 trillion package to extend further relief, though it will face opposition in the Republican-controlled Senate. A vote likely won’t come before Friday.

There are also signs of rising trade tensions between the US and China. President Donald Trump said in an interview with Fox Business on Thursday that he could “cut off” the nation’s relationship with China and that he did not want to talk to Chinese President Xi Jinping right now.

Oil rose following a monthly report from the International Energy Agency identifying signs of recovery in the market. West Texas Intermediate crude climbed as much as 5.8%, to $26.75 a barrel. Brent crude, the international benchmark, rose 4.7%, to $30.55 at intraday highs.