US open: Stocks higher following jobless claims data

8th Aug 2024 14:52

(Sharecast News) - Wall Street stocks were sharply higher at the opening bell on Thursday as fears that the US economy may be headed for a recession reappeared were soothed by weekly jobless claims data from the Labor Department.

As of 1535 BST, the Dow Jones Industrial Average was up 1.38% at 39,298.76, while the S&P 500 advanced 1.74% to 5,289.83 and the Nasdaq Composite came out the gate 2.02% firmer at 16,522.88.

The Dow opened 535.31 points higher on Thursday, reversing losses recorded in the previous session as major indices failed to extend their rebound from recent losses.

Thursday's primary focus was on this week's jobless claims report, which revealed Americans lined up for unemployment benefits at a decelerated pace in the week ended 3 August. According to the Labor Department, initial jobless claims fell by 17,000 to 230,000, below market expectations for a print of 240,000, easing from their post-Covid peak but remaining significantly above this year's average. Continuing claims increased by 6,000 to 1.875m, while the four-week moving average, which aims to strip out week-to-week volatility, increased by 2,500 to 240,750.

The yield on the benchmark ten-year Treasury note edged higher following the jobless figures and was hovering at around 4.005% at the open.

On another note, wholesale inventories increased 0.2% month-on-month to $903.0bn in June, according to the Census Bureau, in line with preliminary estimates and following a downwardly revised 0.5% increase in May. Non-durables inventories rose 0.7% in June, while durable goods stocks fell 0.1%.

In the corporate space, shares in Warner Brothers Discovery were in the red after it revealed it had taken a massive $9.1bn non-cash impairment charge at its networks division as it prepares to part ways with the NBA, while online dating company Bumble tanked after slashing its FY revenue outlook amid growth fears.

Elsewhere, Eli Lilly significantly raised its full-year revenue forecast by $3.0bn after reporting a strong second quarter, driven by the robust performance of its blockbuster weight loss and diabetes drugs Zepbound and Mounjaro, while Under Armour shares were sharply higher at the open after the athletic apparel group posted quarterly earnings that beat on both the top and bottom lines.

Reporting by Iain Gilbert at Sharecast.com