A pedestrian passes in front of the New York Stock Exchange (NYSE) in New York, U.S., on Wednesday, June 3, 2020.
Michael Nagle | Bloomberg | Getty Images
Stocks fell for a second day on Thursday following the release of disappointing unemployment data while traders grappled with a rising number of coronavirus cases.
The Dow Jones Industrial Average traded 200 points lower, or 0.8%. The S&P 500 slid 0.7% while the Nasdaq Composite dropped 0.8%.
An additional 1.48 million Americans filed for unemployment benefits last week, the Labor Department said. Economists polled by Dow Jones expected a print of 1.35 million. This marks the second straight week that U.S. jobless claims data were worse than expected.
“No matter which way you look at it, over a million unemployed is a very bad thing,” said Mike Loewengart, managing director of investment strategy at E-Trade. “It will take some time to unwind the structural damage COVID has caused across the world.”
“While it’s certainly uncomfortable, the everyday investor should be used to ongoing market volatility at this point,” Loewengart said.
Futures fell to their morning lows after the data were released. However, they quickly recovered from those levels as continuing claims fell by more than 700,000 last week.
Thursday’s data release comes amid a sharp increase in new coronavirus cases, which raise questions about the economic recovery as states and countries reopen for business.
More than 45,000 new coronavirus cases were confirmed on Wednesday, a record that surpassed the previous April 26 peak by over 9,000 cases, according to an NBC News tally. States such as Texas, Florida, California and Arizona have all seen major spikes. New York, New Jersey and Connecticut also ordered visitors from certain hotspot states to quarantine for 14 days.
This resurgence led Apple to re-close some stores in Houston, where intensive-care unit beds are near capacity. It also prompted Disney to delay the reopening of its California-based parks beyond July 17.
Shares of companies that would benefit from the economy reopening were under pressure. Airlines such as American, Delta and United all fell more than 2%. Norwegian Cruise Line slid 4.4%.
The negative headlines sent the market into a downward spiral on Wednesday. The Dow, S&P 500 and Nasdaq all posted their worst day since June 11, falling more than 2% each.
“The market has been optimistic that the economy is re-opening and that life would get somewhat back to normal, but the virus may have other ideas,” Chris Zaccarelli, chief investment officer at Independent Advisor Alliance, said in an email. “The market has again gotten caught up in the crossfire of increasing numbers of Covid-19 cases, trade protectionism and politics.”
The Trump administration is considering new tariffs on $3.1 billion exports from France, Germany, Spain and the U.K., according to a notice from the U.S. Trade Representative released Tuesday evening. The new duties on olives, beer, gin and trucks can be up to 100%.
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