BUSINESS Dow drops over 400 points after dismal US weekly jobless data

BUSINESS

Dow drops over 400 points after dismal US weekly jobless data

Xinhua

23:13, May 14, 2020

Nearly three million more American people filed for unemployment benefits in the week ending May 9, according to the US Department of Labor as the COVID-19 pandemic continues to batter the labor market. 

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File photo by AFP

NEW YORK, May 14 (Xinhua) -- The Wall Street's major averages traded lower on Thursday as investors digested another dismal report on US jobless claims.

Shortly after the opening, the Dow Jones Industrial Average dipped 409.74 points, or 1.76 percent, to 22,838.23. The S&P 500 decreased 49 points, or 1.74 percent, to 2,771. The Nasdaq Composite Index was down 155.53 points, or 1.75 percent, to 8,707.64.

All the 11 primary S&P 500 sectors dropped, with both energy and financials down more than 3 percent, leading the losses among the groups.

US initial jobless claims totaled 2.981 million in the week ending May 9, the Department of Labor reported Thursday, following 3.176 million the prior week.

The advance seasonally adjusted insured unemployment rate was 15.7 percent for the week ending May 2, an increase of 0.3 percentage point from the previous week's revised rate.

"The COVID-19 virus continues to impact the number of initial claims and insured unemployment," said the department.

The data came after US Federal Reserve Chairman Jerome Powell's downbeat comments on the economy.

Powell on Wednesday said the COVID-19 pandemic raises "long-term concerns," warning that a prolonged recession and weak recovery could lead to an extended period of low productivity growth and stagnant incomes.

The central bank chief said that while the economic response has been "both timely and appropriately large," it may not be the final chapter, given that the path ahead is both "highly uncertain" and subject to "significant downside risks."

US equities tumbled on Wednesday with the Dow closing down more than 500 points amid profit-taking and Fed comments.

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