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US Stocks fall after grim data

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The US stock market finished session lower on Thursday, 30 July 2020, as risk aversion selloff triggered after latest data showed Jobless claims also rose in the latest week and a first reading on U. S. gross domestic product data for the second quarter confirmed the pandemic pummeled the economy.

At closing bell, the Dow Jones Industrial Average declined 225.92 points, or 0.9%, at 26,313.65. The S&P 500 index lost 12.22 points, or 0.4%, to close at 3,246.22. The tech-heavy Nasdaq Composite Index gained 44.87 points, or 0.4%, to 10,587.81

The U. S. economy suffered its steepest contraction since the Great Depression in the second quarter, as business activity came to an abrupt halt on efforts to slow the virus outbreak. GDP fell at a 32.9% annualized pace, the Commerce Department said.

Jobless claims also rose in the latest week, adding to signs the momentum of economic recovery has slowed as coronavirus cases spiraled in southern and western U. S. states.

First-time claims for unemployment benefits rose slightly last week, to 1.43 million from an upwardly-revised 1.42 million, while continuing claims also rose to 17 million in the week ended July 18.

Shortly after the data, Trump, raised the idea of a delay in elections, an idea immediately rejected by both Democrats and his fellow Republicans in Congress, the sole branch of government with the authority to make such a change.

ECONOMIC NEWS: US Economy Suffers Record Contraction In Q2- US real gross domestic product plummeted at an annual rate of 32.9 percent in the second quarter reflecting the impact of the coronavirus pandemic and following a 5.0 percent slump in the first quarter, the Commerce Department reported on Thursday. Consumer spending led the decrease, cratering by 34.6 percent in the second quarter, as the coronavirus-induced lockdowns in late March and April forced many consumers to stay at home. The record contraction in GDP also reflected decreases in exports, private inventory investment, non-residential fixed investment, residential fixed investment, and state and local government spending. The Commerce Department said the 64.1 percent nosedive in exports was led by capital goods, while the slump in private inventory investment primarily reflected a decrease in retail, particularly motor vehicle dealers. The drop in non-residential fixed investment primarily reflected a decrease in equipment, while the decline in residential investment primarily reflected a decrease in new single-family housing. Meanwhile, the report said federal government spending skyrocketed by 17.4 percent, reflecting the implementation of the coronavirus relief bills.

US Weekly Jobless Claims Edge Up- US first-time claims for unemployment benefits increased for the second straight week in the week ended July 25th, according to a report released by the Labor Department on Thursday. The report said initial jobless claims edged up to 1.434 million, an increase of 12,000 from the previous week's revised level of 1,422,000.

Among Indian ADR, INFOSYS grew 0.78% to $12.95, WNS Holdings added 1.46% to $63.87, Wipro added 2.4% to $4.27, Vedanta rose 0.51% to $5.89, Dr Reddys Labs was up 2.22% to $59.92, and Azure Power Global added 0.75% to $20.22, while Tata Motors fell 1.26% to $7.03, HDFC Bank fell 2.42% to $47.53, and ICICI Bank shed 2.2% to $9.35.

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

First Published: Fri, July 31 2020. 10:12 IST
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