US stocks decline amid tech-sector weakness and unexpected jump in jobless claims
Reuters / Lucas Jackson
- US stocks dropped on Thursday after weekly jobless claims unexpectedly climbed to a four-week high.
- Initial filings for unemployment insurance rose to 861,000 last week, handily surpassing the economist estimate of 773,000.
- Tech giants including Apple and Microsoft slid and led the Nasdaq composite to underperform.
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US equities fell on Thursday following a surprise jump in weekly jobless claims and declining tech giants.
The number of Americans filing for unemployment benefits totaled an unadjusted 861,000 last week, the Labor Department said Thursday morning. The reading lands handily above the 773,000 claims expected by economists surveyed by Bloomberg. The sum is also the highest since mid-January.
Continuing claims, which track Americans receiving unemployment benefits, declined slightly to 4.5 million for the week that ended February 6. Economists projected a larger decline to 4.4 million. The data suggests that, while some pockets of the economy rebound, the labor market's recovery continues to hit snags.
Here's where US indexes stood shortly after the 9:30 a.m. ET open on Thursday:
- S&P 500: 3,901.55, down 0.76%
- Dow Jones industrial average: 31,407.10, down 0.65% (205.92 points)
- Nasdaq composite: 13,817.94, down 1.09%
Tech giants weighed on major indexes and led the Nasdaq composite to underperform. Apple, Netflix, and Microsoft all declined as investors move cash from momentum favorites to recovery plays.
The decline follows a mixed session on Wednesday that pushed the Dow to record highs. Stronger-than-expected retail sales data boosted bullish sentiments, as did the continued decline in daily COVID-19 case counts. Chevron and Verizon gained after Warren Buffett's Berkshire Hathaway revealed new investments in the companies.
The House Financial Services Committee's hearing on the Reddit-trader phenomenon will take center stage in Washington when it begins at 12 p.m. ET. The CEOs of Reddit, Robinhood, Citadel, and Melvin Capital are set to testify along with Keith Gill, the retail investor who rose to fame for his gains during the GameStop rally.
Weak earnings also dragged on the market. Walmart reported fourth-quarter profits that landed below Wall Street estimates. The retail giant also guided for slower sales growth and flat earnings through the current fiscal year.
Bitcoin traded just below $52,000 after hitting a record-high $52,621.84 in late Wednesday trading. The cryptocurrency has thrived through the month as more companies adopt the token as an alternative reserve asset.
Gold rose as much as 0.76%, to $1,789.67 per ounce, at intraday highs. The US dollar weakened against a basket of Group-of-20 currencies and Treasury yields edged higher.
Oil prices rose as power outages in Texas curbed export activity. West Texas Intermediate crude jumped as much as 1.83%, to $62.26 per barrel. Brent crude, oil's international benchmark, was up 1.79%, to $65.49 per barrel, at intraday highs.
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