Wall Street ascends at the opening bell despite jump in jobless claims

The main indices on Wall Street got off to a positive start on Thursday as traders shrugged off a bigger than expected rise in jobless claims last week.

In the early minutes of trading, the Dow Jones Industrial Average was up 0.35% at 33,097 while the S&P 500 climbed 0.69% to 4,000 and the Nasdaq rose 1.34% to 13,424.

Optimism over Joe Biden’s infrastructure spending plans appear to have taken precedence over the jobless claims data, which showed that for the week to March 26, 719,000 Americans filed for unemployment benefits, up from 658,000 the week before and higher than analyst forecasts of 675,000.

The US Department of Labor said: “The 4-week moving average was 719,000, a decrease of 10,500 from the previous week’s revised average. This is the lowest level for this average since March 14, 2020 when it was 225,500. The previous week’s average was revised down by 6,500 from 736,000 to 729,500.”

8:00am: Wall Street to open higher

US markets look like they are set for a positive start on Thursday, helped by President Biden’s US$2trn infrastructure plan.

The Dow Jones Industrial Average is expected to open 47 points or 0.14% higher at 32,981 after showing a decline on Wednesday (unlike the other two main indices). The S&P 500 is forecast to add to its rise with a 0.3% increase while the Nasdaq Composite is set to open 0.9% higher.

Sophie Griffiths, market analyst at OANDA, said: “News that President Biden is ready to inject a further US$2trn into the US economy has been well received. The world’s largest economy will see the huge injection of cash improve roads, railways, broadband and clean energy, while being offset by a rise in corporate taxes. Investors are already pricing in the read-across effect, and a boost to the US economy is good news for the global economy.”

Further signs of the state of the world’s biggest economy will come shortly with the US ISM manufacturing index, which is expected to come in at 61.5 for March, up from 60.8.

Michael Hewson at CMC Markets UK said: “Particular attention [is] likely to be on both prices paid, which hit 86 last month, and a 12-year high, and the employment component, which rose to its highest level in two years. A strong number here would raise expectations further for a strong payrolls report, either tomorrow or in a months’ time.”

Before that are the latest weekly jobless claims. They are expected to fall to 675,000 from 684,000.

Three things to watch for on Thursday:

• Entrants in the earnings calendar for Thursday include used car retailer CarMax Inc (NYSE:KMX), water supply group Consolidated Water Co (NASDAQ:CWCO) and wound care specialist Sanara Medtech Inc (NASDAQ:SMTI)
• Shares in Pfizer Inc (NYSE:PFE) will be back in the spotlight after the company unveiled new data for its COVID-19 vaccine
• Cannabis firm may also be in focus following the legalisation of the drug in New York, opening up another huge market for the sector

Story by ProactiveInvestors