S&P 500 flat as tech boost counters data gloom
The S&P 500 index was little changed on Thursday as gains in heavyweight tech stocks offset gloom over downbeat data that underlined the Federal Reserve’s view of a difficult road to recovery.
The number of Americans filing a new claim for unemployment benefits rose unexpectedly back above the 1 million mark last week after slipping below that level for the first time since the start of the pandemic.
A separate set of data from the Philadelphia Fed showed business conditions index fell more than expected in August.
“Weekly jobless claims show how uneven the economic recovery is going to be,” said Art Hogan, chief market strategist at National Securities in New York.
The volatility in jobless claims follows the lapse of an extra $600 weekly unemployment benefit at the end of July and comes at a time when Democrats in Congress and the White House have failed to reach an agreement on extending it.
“I hope that anything that happens can push Congress to get stimulus together. The longer Washington delays the next round of stimulus, the more this market is going to find turbulence.”
The S&P 500 and Nasdaq retreated from a record level a day earlier after minutes from the Fed’s latest policy meeting highlighted that the labor market’s swift rebound in May and June had likely slowed.
Economically sensitive financial and energy sectors posted the biggest declines among major S&P sectors.
Technology and communications services, which includes Apple Inc, Amazon.com and Netflix Inc, outperformed on bets of success in a post-pandemic world.
Despite signs that parts of the economy were still far away from pre-pandemic levels, the benchmark S&P 500 index completed its fastest recovery from a bear market this week, joining the Nasdaq in scaling new peaks.
At 11:19 a.m. ET, the Dow Jones Industrial Average was down 50.89 points, or 0.18%, at 27,641.99 and the S&P 500 was down 2.79 points, or 0.08%, at 3,372.06. The Nasdaq Composite was up 37.72 points, or 0.34%, at 11,184.18.
Airline stocks took a hit, with the S&P 1500 airlines index dropping 1.1% after American Airlines Group Inc revealed plans to suspend flights to 15 U.S. airports in October as travel demand remains low.
Nvidia Corp slipped 0.3% after disappointing results from the data center business overshadowed a better than expected quarterly sales forecast.
Intel Corp rose 2% after announcing a $10 billion share buyback plan.
L Brands Inc rose 6.1% after reporting a surprise quarterly profit, boosted by strong demand for Bath & Body Works’ products as well as higher online sales of Victoria’s Secret lingerie.
Declining issues outnumbered advancers for a 1.73-to-1 ratio on the NYSE and for a 1.88-to-1 ratio on the Nasdaq.
The S&P index recorded 10 new 52-week highs and no new low, while the Nasdaq recorded 45 new highs and 21 new lows.