The stock market finished lower on Thursday, despite strong earnings from major tech companies, after another sobering jobless claims report showed millions more Americans filing for unemployment.
- The Dow Jones Industrial Average was down 1.2%, over 300 points lower, on Thursday, while the S&P 500 fell 0.9% and the Nasdaq Composite lost 0.3%.
- Another 3.8 million people filed temporary unemployment claims last week, according to data released by the Labor Department.
- The total number of jobs lost over the last six weeks now amounts to more than 30 million, as the coronavirus crisis continues to force business closures, layoffs and furloughs on an unprecedented scale.
- In another sign of just how badly the pandemic is affecting the economy, consumer spending fell 7.5% in March—its steepest decline on record.
- Major tech companies, including Facebook, Microsoft and Google parent Alphabet, have all reported better-than-expected first-quarter revenue this week, despite ongoing headwinds from the coronavirus.
- Facebook shares jumped nearly 7% on Thursday after the company acknowledged a “significant” pullback in advertising revenue during March, but said it also sees “signs of stability” for ad sales so far in April.
“The markets have continued to rally but may have gotten a bit ahead of themselves,” warns Brad McMillan, chief investment officer for Commonwealth Financial Network.
Despite Thursday’s pullback, the stock market is still on track for one of its best months in decades. The S&P 500 has risen more than 13% in April, putting it on track for its biggest one-month gain since 1974. The Dow is up 12% this month, which would be its best monthly gain since 1987.
Stocks surged on Wednesday after Gilead Sciences reported “positive data” on its antiviral remdesivir drug as a potential treatment for coronavirus. The company cited two recent tests that showed beneficial results, and Dr. Anthony Fauci, director of the National Institute of Allergy and Infectious Diseases, said later in the day that remdesivir has a “clear-cut” positive effect treating the virus. Stocks held on to their gains late on Wednesday after the Federal Reserve left its benchmark interest rate unchanged, pledging to keep it near zero until the economy recovers.