Stocks were flat on Thursday as traders kept an eye on Washington for clues on a new coronavirus stimulus package and pored over better-than-expected unemployment data.
The Dow Jones Industrial Average rose less than 4 points. The S&P 500 dipped 0.1%. The Nasdaq Composite was also marginally lower.
Materials, health care and energy were the worst-performing S&P 500 sectors. A 1.7% gain in McDonald's was offset by declines in Merck and Johnson & Johnson within the Dow.
Senate Majority Leader Mitch McConnell told CNBC's "Squawk on the Street" that lawmakers were still at odds over how much stimulus is appropriate. He added that a bill passing the Senate would require liability protections for companies impacted by the pandemic.
In another interview with CNBC's "Squawk on the Street," however, House Speaker Nancy Pelosi took a shot at Republicans and their priorities. She stated: "Perhaps you mistook [Republicans] for somebody who gives a damn." Pelosi added, though, both sides will find a solution to the situation.
"If we don't have a deal, we've got to have a sell-off," CNBC's Jim Cramer said Thursday. "It's not like we can just avoid a deal and say it doesn't matter. And that's what I'm getting concerned about."
The White House appeared on Wednesday to yield slightly on its opposition to continued federal support for unemployment benefits. The Trump team offered to extend extra federal unemployment insurance into December at $400 per week, NBC News and Politico reported.
Treasury Secretary Steven Mnuchin and White House chief of staff Mark Meadows also offered to extend a moratorium on evictions from federally backed housing into December. Democrats, meanwhile, cut their request for U.S. Postal Service funding to $10 billion from $25 billion, according to the reports.
Jobless claims better than expected
The Labor Department said initial jobless claims for the week ending Aug. 1 totaled 1.186 million. That's well below a Dow Jones estimate of 1.423 million and the lowest claims level since the pandemic began.
"The overall tone of the jobless claims data is the best it has been in 3 weeks or so," said Thomas Simons, money market economist at Jefferies, in a note. "The decline is the biggest since the week of June 6, so the data does not have the same sort of 'stalling out' theme that we have seen in recent weeks."
"However, one cannot help but notice the date of the reference week, August 1, which is the day after the $600 per week enhanced benefit provided by the CARES Act expired," Simons said. "So, is the drop this week related to an improvement in the labor market? Or is it related to folks who had some agency in their employment situation electing to collect the benefit rather than return to work now no longer being able to do so?"
The data came a day before the government's monthly nonfarm payrolls report, which is expected to show jobs growth of 1.264 million for July.
Wall Street was coming off a solid session in which the Nasdaq Composite notched another record close and the S&P 500 ended within 2% of its Feb. 19 all-time high.
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Stocks are flat as investors wait on stimulus bill deal - CNBC
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