TOPLINE
The stock market took a hit from disappointing unemployment data and a rising number of coronavirus cases Thursday morning, but rebounded after U.S. regulators said they would ease post-financial crisis restrictions on big banks.
Several states are seeing record numbers of new coronavirus cases.
Spencer Platt/Getty Images
KEY FACTS
The Dow Jones Industrial Average was up 1.2%, nearly 300 points, on Thursday, while the S&P 500 and Nasdaq Composite both gained 1.1%.
Stocks opened lower on the back of more disappointing jobless claims data: Another 1.5 million Americans filed for unemployment in the week ending June 20, more than the 1.3 million expected.
Continuing claims fell below 20 million for the first time since April, but the overall jobless numbers still remain high—and the labor market’s recovery could be impeded by a resurgence of coronavirus across the country.
Medical experts are increasingly worried that new coronavirus cases in the United States, which hit their highest levels since April, could hinder an economic reopening and recovery: States like Texas, Florida, California and Arizona are all reporting record numbers of new infections.
Stocks cut losses and turned positive after federal regulators said they will loosen bank restrictions, including the Volcker Rule, sending shares of major banks surging.
Shares of JPMorgan Chase, Bank of America, Citigroup and Morgan Stanley gained more than 3%, while Goldman Sachs and Wells Fargo traded around 4% higher.
Crucial quote
“Jobless numbers are flatlining after weeks of improvement,” says Vital Knowledge founder Adam Crisafulli. It was the third consecutive week of job losses coming in at around 1.5 million, with continuing claims still hovering around 20 million. But the rate of jobless claims had leveled out before the recent spike in coronavirus cases, Crisafulli notes, “which means it could see upward pressure over the coming weeks.”
Surprising fact
Only four states—New York, New Jersey, Connecticut and Massachusetts—are currently “on track” to contain coronavirus, according to nonprofit tracking database Covid Act Now. A total of 22 states are either at risk of an outbreak or already facing one.
Key background
Amid the negative headlines around a resurgence of coronavirus, stocks plunged on Wednesday, posting their worst losses since June 11. The Dow dropped by over 700 points, while the S&P and Nasdaq both fell over 2%.
Further reading
Dow Plunges 700 Points As Investors Worry About A Resurgence Of Coronavirus (Forbes)
These Are The Only 4 States On Track To Contain Coronavirus (Forbes)
IMF Slashes Global GDP Forecasts, Warning Of An Economic Crisis ‘Like No Other’ (Forbes)
Nasdaq Hits Record High As Apple, Amazon And Netflix Shares Jump (Forbes)
Investors Are Way Too Optimistic About An Economic Rebound, According To This Market Expert (Forbes)
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