October 20, 2020

Stocks Mixed on Lackluster Economic Data

Stocks wavered in a narrow range at the open before heading lower as data showing stubbornly high jobless claims, and lackluster chain-store sales provided little reason to get back into the market after a string of weak economic data.

Bank stocks stabilized after falling on news that Goldman Sachs received a subpoena from New York prosecutors seeking information on the investment bank’s role leading into the global financial crisis. Goldman’s stock fell 1.1 percent to $134.72.

In addition, Moody’s Investors Service said Thursday that it was reviewing the ratings of the Bank of America, Citigroup and Wells Fargo for possible downgrades. Moody’s said that the assumption that the banks were too big to fail might no longer be true as the result of the Dodd-Frank Act.

Stock in the three banks was slightly higher, despite the warning.

At the close the Dow Jones industrial average was down 41.59 points, or 0.34 percent, at 12,248.55. The Standard Poor’s 500-stock index was down 1.61 points, or 0.12 percent, and the Nasdaq composite index was up 4.12 points, or 0.15 percent, at 2,773.31 percent.

Initial claims for state unemployment benefits slipped 6,000 to a seasonally adjusted 422,000, while economists polled by Reuters forecast 415,000.

Investors were reluctant to make big bets ahead of the nonfarm payrolls data due on Friday, which was expected to show 150,000 jobs were added in May, according to a Thomson Reuters survey of economists.

Strength in education stocks sent the Nasdaq higher after officials in the United States softened new rules that could have cut off tuition aid to programs run by profit-making colleges.

Corinthian Colleges surged 29.6 percent to $5.18, and the Apollo Group rose 10 percent to $46.35.

Retail sales were higher last month, led by discount stores, but the increase was not as high as that in April and fell short of analysts’ forecasts as consumers continued to face an uncertain economy.

Sales at discount stores that have been open at least a year grew by 7.8 percent in May, the best showing by any group of retailers in terms of sales last month, according to a survey of 24 retailers released on Thursday.

But the overall measure of what are known as same-store sales, compiled by Thomson Reuters, rose 4.9 percent on average in May, slightly below the 5.4 percent that analysts had forecast. It was also below the 8.9 percent growth in April, which was one of the biggest increases in the index in the last few years.

Some of the bigger retailers fell. Target edged down 0.9 percent to $48.10, and Gap fell 3.2 percent to $18.30.

Article source: http://feeds.nytimes.com/click.phdo?i=544a9aeee78881594f2645d988269216

Speak Your Mind