Saturday, 08 August, 2020

Nasdaq surges on megacap earnings but U.S. fiscal uncertainty nags

Provided by CNBC A cyclist passes by the New York Stock Exchange in New York Provided by CNBC A cyclist passes by the New York Stock Exchange in New York
Ginger Lawrence | 02 August, 2020, 05:25

Investors betting on more US government stimulus, before an extra $600-per-week federal jobless benefit expires on Friday, have also been disappointed as the Senate adjourned for the weekend and will return on Monday.

"'As expected' is the best that can be said about second quarter GDP".

Also jobless claims rose last week, adding to signs the momentum of economic recovery has slowed as coronavirus cases spiralled in southern and western USA states.

The idea was immediately rejected by both Democrats and his fellow Republicans in Congress, the branch of government with the power to make that change. It was the second time that the index has flip-flopped on consecutive days this week.

She cited the stimulus battle along with election uncertainty on top of weak data and earnings angst. It would take only a few weeks before millions of people are cash strapped.

"You open the door, it comes piling out, you're frightened and then you settle down and start picking stuff up and putting it back where it belongs", she said. The Dow was down as many as 547 points, while the S&P 500 tumbled 1.7% within the first hour of trading.

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These are three of the biggest companies in the world, making up almost 13% of the S&P 500 themselves, so their movements hold great sway over indexes.

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Technology consumer discretionary and communications services were the only sectors to eke out small gains.

Stocks posted big gains for the month, led by the Nasdaq's almost 7% climb.

But investors were anxious about earnings from the Nasdaq's so called four horsemen - Apple and Amazon, Alphabet and Facebook.

Next week in the United States is authorized economic checkpoint: Extended unemployment benefits due to the interest rate crisis will be paid on the last day of Friday, and Americans left without subsidies on Monday will have to pay rent and repay mortgages. Amazon, Apple and Facebook each reported stronger profit for the latest quarter than Wall Street expected late Thursday, and each rose at least 4% in morning trading.

Phil Toews, chief executive officer of Toews Corp in NY, said the market had been influenced by the central bank and positive momentum.

Declining issues outnumbered advancing ones on the NYSE by a 1.40-to-1 ratio; on Nasdaq, a 1.94-to-1 ratio favored decliners.

"The ongoing public health crisis will weigh heavily on economic activity, employment, and inflation in the near term, and poses considerable risks to the economic outlook over the medium term", the Fed said in a statement after concluding a two-day policy meeting, adding it made a decision to maintain the target range for the federal funds rate at 0-0.25 per cent.

About 11.01 billion shares changed hands in US exchanges, compared with the 10.53 billion daily average over the last 20 sessions.