Shares ended a tough September with more declines on Thursday as jobless claims were worse than expected. Meanwhile, Washington seemed poised to avoid a government shutdown.
At noon, the
Dow Jones Industrial Average
is down by 410 points, or 1.2%, while the
was down 0.8%.
The Nasdaq composite
was down 0.3%, reversing earlier gains.
The S&P 500 is set to end September down more than 3%, its worst monthly performance this year, although it remains in positive territory for the third quarter of 2021. The month’s decline is worse than the 0.8% average drop from last September 20, according to Instinet. Historically, when the index falls by more than 2% in September, it registers on average a decrease of 0.4% in October. The index is on track to end the third quarter up about 1.5%.
The Dow Jones, on the verge of ending the quarter down around 1%, is expected to experience its largest quarterly decline in point and percentage since the first quarter of 2020. The index, largely made up of more sensitive stocks to the economy, had a difficult quarter as markets feared the spread of Covid-19, supply chain constraints, and reduced Federal Reserve support, could hamper economic growth. Fortunes have recently turned for the Dow Jones, which rose more than 1% from its September low.
Senate Majority Leader Chuck Schumer announced Wednesday evening that a deal had been reached to fund the US government. A final vote on the financing bill will take place on Thursday.
The progress in Washington appears to be helping investors put on Tuesday’s “taper tantrum”, which pushed bond yields up and particularly hurt tech stocks. The 10-year Treasury yield didn’t budge much on Thursday, even after weekly jobless claims were 362,000, higher than an expected 330,000 and worse than last week’s 351,000. The yield had jumped to 1.54% from a low of 1.31% last week, but is now down 1.53%.
A truer reading of how quickly people are returning to work will come with September’s jobs report, which is expected to be released next week.
The tech-rich Nasdaq outperformed the other two major US indices in part because bond yields suspended their recent surge for a second straight day.
Overseas, Hong Kong
Hang Seng Index
fell 0.4%. An energy crisis in China has hit industrial production, weighing on morale. The official purchasing managers index for China’s manufacturing sector fell more than expected to 49.6 in September, from 50.1 in August, due to the underperformance of energy-intensive industries. This is the lowest level since February 2020, when the Covid-19 pandemic hit Chinese industry the most.
The dollar remained close to its highest level in a year, with the
US dollar index
Here are 8 actions in motion Thursday:
(ticker: KMX) the stock fell 11% after posting a profit of $ 1.72 per share, missing estimates of $ 1.88 per share, on sales of $ 7.99 billion, higher than expectations of $ 6.91 billion.
McCormick & Company
The stock (MKC) fell 1.6% after posting earnings of 80 cents per share, beating estimates of 72 cents per share, on sales of $ 1.55 billion, above expectations of $ 1.54 billion.
(SNOW) share rose 2.4% after being upgraded to Buy from Neutral at BTIG Research.
The stock (KSS) fell 14% after being demoted to Underperform by Buy at Bank of America.
The stock (SBUX) fell 1% after being downgraded to Neutral from the overweight in Atlantic Equities.
(PRGO) was up 10% after the pharmaceutical group settled an Irish tax dispute on Wednesday.
(SPCE) climbed 12%. The Federal Aviation Administration cleared the company after an investigation into a flight deviation on the trip that took founder Richard Brandon to space this summer.
Genetic sequencing specialist Oxford Nanopore (ONT.UK) rose more than 45% on its London IPO, valuing the biotech company at $ 4.6 billion.
Write to Jacob Sonenshine at [email protected]