Stocks rallied briefly, but then lost steam, as upbeat figures on U.S. employment failed to counter investors’ concern about friction over trade and the stalemate over another U.S. stimulus package.
Some 963,000 million people in the U.S. filed initial claims in the latest week, while economists expected the data to show that 1.1 million claims—the lowest number since the pandemic took hold. Last week’s release showed that 1.2 million people newly filed for unemployment benefits.
Shortly after the open, the
Dow Jones Industrial Average
was 0.3% lower at 27,884, while the
was 0.1% lower, and the
was up 0.4%. Futures on the Dow and the S&P 500 had briefly turned positive in response to the jobs news,
slipped 0.4%, while the German
and the French
lost 0.3%. The
which surged 2% on Wednesday despite the U.K. economy’s record plunge in the second quarter, was 1% lower.
The deadlock over another round of U.S. stimulus continued to drag on sentiment after President Donald Trump said a deal is “not going to happen.”
Developments on trade are moving along two lines. With the U.S.-China tensions bubbling in the background, officials from both countries are due to meet on Saturday to review their trade deal.
Meanwhile, the Office of the U.S. Trade Representative said tariffs on European Union products, including whiskey and
aircraft, will remain unchanged despite efforts by the plane maker to comply with a World Trade Organization decision over state aid. The U.S. raised tariffs on €7.5 billion of EU products last year as retaliation for subsidies provided to Airbus.
American officials had threatened to raise tariffs or add new products this summer. Spreadex analyst Connor Campbell said the fact it “failed to escalate the situation with fresh tariffs on vodka, gin and beer” prevented a market selloff.
shares fell 4.5%, after the travel operator swung to a €1.4 billion loss in the third quarter as the coronavirus pandemic continued to hit the company. The hotel, airline and cruise operator said dividend payments and share buybacks will be restricted to the term of the €1.2 billion stabilization package announced on Wednesday with the German government.
stock slipped 4.5%, as the Danish brewer said it expected operating profit to fall 10% to 15% this year. It also warned demand would remain under pressure in China in the second half and that European sales wouldn’t return to normal this year.
In U.S. action, Tapestry (ticker: TPR) shares gained 4.8% premarket after the owner of brands such as Coach and Kate Spade posted a smaller-than-expected loss during its fiscal fourth-quarter thanks to an increase in online sales even as many of its stores remain closed due to the pandemic.
(CSCO) shares were off by 7% after the company reported a weak outlook for the current quarter, despite fiscal fourth-quarter results coming in better-than-expected.
Micron (MU) has fallen 2% after getting cut to Hold from Buy at
(KBH) has dropped 3% after getting downgraded to Neutral from Buy at Seaport Global.