Dow Jones Industrial Average Tumbles as Oil Drop, Dollar Weakness Weigh
Dow Jones Industrial Average Brushes Good Data
The Dow Jones Industrial Average (DJIA) tumbled on Thursday as a fresh slump in oil prices and a sharp drop in the U.S. dollar against the yen overshadowed a positive report on U.S. jobless claims.
At 2:39 p.m. in New York, the Dow Jones index decreased 187 points, or 1.1%, to 17,528, with 28 shares declining and two issues advancing. The 30-member gauge had shed 220 earlier in the session.
The S&P 500 dropped 1.3% to 2,038 while the tech heavy NASDAQ Composite plunged 1.6% to 4,842.
USD Hits New 52-Week Low Versus JPY
The U.S. dollar index was down 0.1% to 94.36 on Thursday. The dollar extended its weakness against the Japanese yen, falling 1.8% to a new 52-week low of 107.7 yen. The U.S. currency is currently 14% lower than its 52-week high of 125.9 yen reached last June.
Oil prices ended lower, pressured by concerns over global economic growth and an unexpected decline in U.S. crude inventories. West Texas Intermediate, the U.S. oil benchmark, fell 1.3% to finish at $37.26 a barrel.
Gold prices finished solidly higher, helped by the dollar’s additional weakness against the Japanese yen, a day after the Federal Reserve further hinted it’s adopting a dovish view on interest-rate hikes. The gold price for June deliver advanced 1.1% to settle at $1,236.20 a troy ounce.
The Stoxx Europe 600 closed down 0.8% at 328.10, erasing an early gain, as investors pored over minutes from the European Central Bank’s policy meeting that indicated policy makers may consider further rate cuts.
Jobless Claims Fall More than Expected
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 on 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.
Valeant Trims Earlier Rally; Wynn Holds Gains
Valeant Pharmaceuticals Intl Inc (NYSE:VRX) rose as much as 12% before trimming gains to $35.05, up 2.5%. The Canadian drug maker has reportedly secured amendments to its debt from lenders.
Wynn Resorts, Limited (NASDAQ:WYNN) surged 13% to 100.82 after announcing a major expansion project in Las Vegas.
Bed Bath & Beyond Inc. (NASDAQ:BBBY) was up 0.4% at $49.01, erasing an early rally to as high as $52.33. 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 0.4% 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 2.3% to $84.14, reversing a gain at market open. 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) slid four percent to $3.45 as the telecommunications company unveiled yet another unusual financial arrangement to raise cash. Sprint agreed to sell $3 billion of network gear to specially created entities, which will pay Sprint $2.2 billion for the equipment and swiftly lease the gear back to the carrier.
Costco Wholesale Corporation (NASDAQ:COST) retreated more than 3% to $152.01 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 0.6% thus far in 2016, compared to a 0.3% loss for the S&P 500 and 3.2% slump for the NASDAQ.