Stock Market News for June 5, 2020
Benchmarks closed mixed on Thursday, as investors struggled with poor jobs data and a selloff among tech shares. Nevertheless, the Dow booked its straight fourth-day gain and its longest run since mid-April.
The Dow Jones Industrial Average (DJI) gained 11.93 points, or less than 0.1%, to close at 26,281.82 and the S&P 500 slided 10.52 points, or 0.3% to close at of 3,112.35. While, the Nasdaq Composite Index closed at 9,615.81, shedding 67.10 points, or 0.7%. The fear-gauge CBOE Volatility Index (VIX) increased 0.6%, to close at 25.81. Advancing issues outnumbered declining ones for 1.08-to-1 ratio on the NYSE and a 1.14-to-1 ratio on the Nasdaq favored advancers.
How Did the Benchmarks Perform?
In the past few days markets have shown remarkable resilience since it plunged in late March. The Nasdaq, S&P 500 and Dow are still 3%, 9% and 12% lower than their respective record highs in February this year.
Of the 11 major sectors of the S&P 500, financials, industrials and materials sectors ended in the positive. Decline in shares of big tech companies weighed on the broader market. Shares of Facebook, Inc. FB and Netflix, Inc. NFLX closed 1.7% and 1.8% lower, respectively.
On the contrary, reopening of the economy has helped the airlines industry rise. On Thursday, American Airlines Group Inc. AAL reported plans to boost flights by 74% in July, indicating that the worst effects of the coronavirus pandemic-led travel standstill has passed. This cheered investors, helping shares close 41.3% higher, yesterday. Shares of United Airlines Holdings, Inc. UAL, Delta Air Lines, Inc. DAL and Southwest Airlines Co. LUV closed 16.2%, 13.7% and 5.1% higher, respectively.
American Airlines, Delta Air Lines and United Airlines carry a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Disappointing Jobs Data
On Thursday, the Labor Department said that initial jobless claims have tapered off slowly since it had hit peak of almost 7 million in late March. Initial claims came in at 1,877,000, a decline of 249,000 from the previous week's revised level of 2,126,000 claims.
The figures surpass the consensus estimate of 1,822,000 but showed that the number of Americans filing for unemployment benefits dipped below 2 million for the first time since mid-March.
Continuing jobless claims rose by 437,072 for the week ending May 23, and continued to stabilize after a historic surge. While the data is still bleak, it also suggests that the US economy may have seen the worst of the coronavirus pandemic’s impact.
Investors await the Labor Department’s jobs report scheduled for release on Friday. Analysts expect the U.S. unemployment rate to hit a historic 19.5%.
ECB Approves Stimulus Package
On Jun 4, the European Central Bank delivered further stimulus to the economy, officials reported expansion of its Pandemic Emergency Purchase Program by $674.5 billion. The central bank also said announced that the program will be extended till June 2021. Officials also believe that the economy is showing signs to reach a lowest point, and expects the region’s economy to contract 8.7% in 2020.
The American counterpart, Federal Reserve is scheduled to hold its two-day policy meeting next week.
Stocks that Made Headline
Schwab-Ameritrade Deal Gets DOJ & Shareholder Nod, Stocks Up
Charles Schwab’s SCHW deal to acquire TD Ameritrade Holding AMTD for $26 billion has received consent from the U.S. Department of Justice (“DOJ”). (Read More)
Broadcom Q2 Earnings & Revenues Surpass Estimates
Broadcom AVGO reported second-quarter fiscal 2020 non-GAAP earnings of $5.14 per share, which surpassed the Zacks Consensus Estimate by 0.2%. (Read More)
eBay Lifts Q2 Guidance Amid Coronavirus Pandemic
eBay’s EBAY shares gained 6.3% after the company raised its second-quarter 2020 guidance. (Read More)
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Southwest Airlines Co. (LUV) : Free Stock Analysis Report
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Delta Air Lines, Inc. (DAL) : Free Stock Analysis Report
United Airlines Holdings Inc (UAL) : Free Stock Analysis Report
Netflix, Inc. (NFLX) : Free Stock Analysis Report
American Airlines Group Inc. (AAL) : Free Stock Analysis Report
Broadcom Inc. (AVGO) : Free Stock Analysis Report
TD Ameritrade Holding Corporation (AMTD) : Free Stock Analysis Report
Facebook, Inc. (FB) : Free Stock Analysis Report
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