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US Market extends slide after steep rise in jobless claims

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The US stock market finished session in negative territory on Thursday, 15 October 2020, as a rise in weekly jobless claims compounded worries about a stalling economic recovery. Meanwhile, sentiments also dampened amid uncertainty about a new stimulus bill after Treasury Secretary Steven Mnuchin suggested on Wednesday that a new relief package is not likely to pass before next month's elections.

At closing bell, the Dow Jones Industrial Average index declined 19.80 points, or 0.07%, to 28,494.20. The S&P 500 index fell by 5.33 points, or 0.15%, to 3,483.34. The tech-heavy Nasdaq Composite Index dropped 54.86 points, or 0.47%, to 11,713.87.

The US market commenced trading with soft note reaction to a Labor Department report showing an unexpected increase in first-time claims for U. S. unemployment benefits in the week ended October 10th. The report said initial jobless claims climbed to 898,000, an increase of 53,000 from the previous week's revised level of 845,000.

Selling pressure was also generated amid uncertainty about a new stimulus bill after Treasury Secretary Steven Mnuchin suggested on Wednesday that a new relief package is not likely to pass before next month's elections. Senate Majority Leader Mitch McConnell has also cast doubts on whether a bill can pass before the elections and recently announced plans to vote on a more limited relief package.

Morgan Stanley rose 1.3% after it beat third-quarter profit estimates, winding up mixed results from major U. S. lenders.

Recent bank earnings reports saw those focused on trading clocking big gains, while retail banks took a hit from the COVID-19 pandemic.

Shares of Vertex Pharmaceuticals Inc declined after the drug developer discontinued its trial of a protein deficiency disorder treatment.

ECONOMIC NEWS: Philly Fed Index Shows Significant Acceleration In Growth In October- The pace of growth in regional manufacturing activity jumped to 32.3 in October from 15.0 in September, a report released by the Federal Reserve Bank of Philadelphia on Thursday showed. With the much bigger than expected increase, the Philly Fed Index spiked to its highest level since before the coronavirus- lockdowns. The sharp increase by the headline index came as the new orders index soared to 42.6 in October from 25.5 in September and the shipments index surged up to 46.5 from 36.6.

US Weekly Jobless Claims Jump To 898,000- US first-time claims for unemployment benefits increased in the week ended October 10th to 898,000, an increase of 53,000 from the previous week's revised level of 845,000, according to a report released by the Labor Department on Thursday. With the unexpected increase, jobless claims reached their highest level since topping 1 million in the week ended August 22nd. The Labor Department said the less volatile four-week moving average also inched up to 866,250, an increase of 8,000 from the previous week's revised average of 858,250. Meanwhile, the report said continuing claims, a reading on the number of people receiving ongoing unemployment assistance, tumbled by 1.165 million to 10.018 million in the week ended October 3rd.

Among Indian ADR, INFOSYS fell 6.72% to $15.26, Wipro fell 1.57% to $5.03, HDFC Bank dropped 1.79% to $55.40, ICICI Bank slipped 2.34% to $10.87, WNS Holdings fell 3.4% to $65.56, and Azure Power Global fell 7% to $27.51. Dr Reddys Labs declined 2.13% to $68.32. Tata Motors fell 1.23% to $8.81, and Vedanta fell 2.29% to $5.11.

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(This story has not been edited by Business Standard staff and is auto-generated from a syndicated feed.)

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First Published: Fri, October 16 2020. 08:59 IST
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