Dow Jones Industrial Average Opens Lower Despite Positive Jobless Claims Data
Lower Dow Jones Industrial Average Weighs on Sentiment
The Dow Jones Industrial Average (DJIA) fell on Thursday despite a positive report on U.S. jobless claims that indicated a healthy labor market in the world’s largest economy.
Investors continued to assess minutes of the Federal Open Market Committee and concluded there may be a slight increase in the number of hawks in the central bank who call for an interest-rate hike before June.
A fresh decline in oil prices and news that the European Central Bank (ECB) may adopt more interest-rate cuts weighed on sentiment.
As of 9:37 a.m. in New York, the Dow Jones index fell 0.6% to 17,604, with 28 shares declining and two issues little changed.
The S&P 500 was down 0.5% at 2,056 while the tech heavy NASDAQ Composite slid 0.4% at 4,900.
The 30-member Dow Jones index closed in solidly in positive territory on Wednesday, helped by a small recovery in oil prices and minutes from the Federal Reserve’s latest policy meeting, which showed a cautious approach to raising interest rates before June.
U.S. Jobless Claims Fall More than Forecast
The number of U.S. workers who applied for new unemployment benefits fell last week, suggesting the labor market continued to strengthen despite sluggish economic growth.
Initial claims for jobless benefits dropped by 9,000 to a seasonally adjusted 267,000 in the week ended April 2, the Labor Department said Thursday. A Reuters survey of economists had forecast claims slipping to 270,000 in the latest week.
It was the first time claims decreased in four weeks.
The unemployment benefits figure is near historic lows. Last week was the 57th straight week that initial jobless claims remained below 300,000, extending the longest streak below that threshold since 1973.
Crude oil fell on Thursday as investors considered an unexpected decline in U.S. crude inventories. West Texas Intermediate, the U.S. oil benchmark, fell 1% to $37.38 a barrel.
Gold prices increased 1.4% to $1,240.
The Stoxx Europe 600 turned lower, falling 0.2%, after minutes from the European Central Bank’s policy meeting indicated policy makers may consider further rate cuts.
Valeant Pharma, Wynn Resorts Surge
Valeant Pharmaceuticals Intl Inc (NYSE:VRX) soared 11% to $38.03 after the Wall Street Journal reported that the Canadian drug maker had secured amendments to its debt from lenders.
Wynn Resorts, Limited (NASDAQ:WYNN) surged 8.3% after announcing a major expansion project in Las Vegas.
Bed Bath & Beyond Inc. (NASDAQ:BBBY) climbed 3.7% to $50.59. The housewares retailer posted better-than-expected adjusted quarterly profit and revenue and announced its first-ever quarterly dividend.
Rite Aid Corporation (NYSE:RAD) inched 0.3% lower at $8.10 as the third-largest drugstore chain reported a same-store sales drop in its fourth quarter.
L Brands Inc. (NYSE:LB) fell 0.6% to $85.60, reversing an earlier gain. The Columbus, Ohio-based company said it will restructure its Victoria’s Secret business and reported better-than-expected growth Thursday across its established stores in March.
Sprint Corp. (NYSE:S) was little changed. The fourth-largest wireless carrier reached a deal with several bankrupt entities to sell and then lease back network assets which will then be used as collateral to raise $2.2 billion.
Costco Wholesale Corporation (NASDAQ:COST) surrendered 2.5% to $152.94 after the warehouse retailer reported a one percent increase in March comparable-store sales, trailing the consensus estimate of a 1.9% increase.
The Dow Jones index is up 1.7% thus far in 2016, compared to a 1.1% gain for the S&P 500 and 1.7% loss for the NASDAQ.