- The Dow Jones rallied again on Thursday. The index is on course for its best week in almost 90 years.
- Fiscal stimulus and comments from Fed Chair Jerome Powell helped boost risk appetite in the stock market.
- Unfortunately, a historically brutal unemployment situation may only get worse.
The Dow Jones kept its stunning rally going on Thursday as Nancy Pelosi stated she had “no doubts” that the $2 trillion fiscal package would be approved by Congress. Further supporting the stock market was Fed Chair Jerome Powell, who assured investors the U.S. central bank would “not run out of ammo.”
All this political jawboning helped shield the Dow from a historically bad jobless claims number, which spiraled above 3 million – with more pain to come.
Dow Jones on Course for Best Week In 88 Years
All three of the major U.S. stock market indices enjoyed another day of impressive gains:
- The Dow rallied 783.74 points or 3.7% to 21,984.29.
- The S&P 500 jumped 4.16% to 2,578.54.
- The Nasdaq advanced 3.6% to 7,649.83.
Things weren’t so bright in the commodity sector, where the oil price tumbled 6.5%.
Already battered by a brutal supply glut, oil unexpectedly suffered another demand shock after the U.S. government announced it would cancel its strategic purchases due to funding concerns.
The gold price was flat despite the rally in equities. This was primarily the result of a softening U.S. dollar.
Stock Market Priced for Historically Bad Jobless Claims Report
The spread of the coronavirus continues to gather pace in the United States, as confirmed cases now exceed 76,500. Given the current trajectory, the U.S. should comfortably overtake both China (81,750) and Italy (80,500) within a few days.
On the economic data front, the U.S. economy suffered its worst jobless claims data release on record. The 3.28 million…