U.S. stock ETFs declined Thursday as jobless claims remain elevated and pessimism over a quick economic recovery rises with increasing Coronavirus cases.
On Thursday, the Invesco QQQ Trust (NASDAQ: QQQ) was up 0.5%, SPDR Dow Jones Industrial Average ETF (NYSEArca: DIA) fell 1.2%, and SPDR S&P 500 ETF (NYSEArca: SPY) dropped 0.7%.
The United States tallied more than 60,000 new COVID-19 infections on Wednesday, a single-day global record, with Florida and Texas showing a record one-day increase in deaths, Reuters reports.
“We need consumers and businesses to be engaged in a recovery – shutdown or no shutdown – and the news of the increased spread of the virus weighs on consumer psychology and sentiment,” Willie Delwiche, investment strategist at Baird, told Reuters. “The market has rallied in anticipation of progress being made on the economy and today is a step back from that.”
Further weighing on the outlook, updated figures revealed 1.3 million Americans filed for unemployment benefits for the week ended July 4, the Wall Street Journal reports. While weekly claims have dipped from their highs, the rate remains near 1.5 million in prior weeks, causing some to warn that the U.S. economic recovery may be stalling.
U.S. markets initially opened higher Thursday after data showed the number of Americans filing for jobless benefits dipped to a near four-month low. However, there is still a record of 32.9 million people collecting unemployment checks as of the third week of June.
“It’s not surprising, depending on some of the headlines that scroll through at this time, you’re going to have what we call basically a choppy market,” Jack Janasiewicz, portfolio manager at Natixis Investment Managers Solutions, told the WSJ. “It’s going to be uneven. You’re going to have fits and starts. The market seems to focus on any sort of bad coronavirus news.”
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