Close Update: Stocks End Mixed as Jobless Claims Increase for a Second Week Amid Surge in COVID-19 Cases

Wednesday, November 25, 2020 4:27 PM | MT Newswires

US stocks closed mixed on Wednesday after worse than expected jobless claims data, rising for a second consecutive week as a surge in COVID-19 cases prompted more restrictions. The US markets will be closed on Thursday in observance of the Thanksgiving Day holiday.

The Dow Jones Industrial Average fell 0.6% to 29,872.47 and the S&P 500 edged down 0.2% to 3,629.65, while the Nasdaq Composite rose 0.5% to 12,094.40. Most sectors were in the red, with only consumer discretionary, technology, real estate, and utilities sectors posting gains. Energy was the steepest decliner.

On Tuesday, the Dow and the S&P closed at record levels, with the Dow surpassing the 30,000 mark, as the prospect of a smooth transition to a new presidential administration and positive COVID-19 vaccine developments buoyed Wall Street and global markets.

Focus, however, returned to the labor market after new unemployment claims came in at 778,000 for the Nov. 11 week versus the consensus for 730,000 compiled by Econoday and the 748,000 revised claims in the previous week. It was the second straight weekly rise as more restrictions are imposed to contain rising coronavirus cases.

Global infections climbed close to 60 million, including 12.6 million in the US, according to the Johns Hopkins University tracking website. The US has logged more than 260,000 fatalities since February.

Meanwhile, The Gap (GPS) slumped 19.6% after reporting a mixed set of quarterly results against market expectations.

"We think the low SG&A flow-through and comments that marketing could remain elevated add some new concerns that GPS will be able to achieve those targets as easily," Credit Suisse analysts said. Still, they raised their price target to $23 from $19 while keeping their underperform rating.

Separately, Slack Technologies (WORK) jumped 37.6% after The Wall Street Journal reported that Salesforce (CRM) held talks to buy the firm.

On the energy front, oil prices were firmer, with US West Texas Intermediate crude up by 2% at $45.80 per barrel and Brent crude rising by 1.9% to $48.77. In the precious metals markets, gold was flat at $1,810.20 an ounce, and silver added 0.2% to $23.45 an ounce.

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