Stocks rose Wednesday, as Wall Street contended with conflicting economic signals.
All three major U.S. indices, which dipped in and out of the red all day, rose by the market’s close. The S&P 500 rose more than 2%.
Crude oil rose 21% to $24 a barrel.
OPEC agreed to terms on cutting oil production, amid a global supply glut sparked by weakening demand over the Coronavirus.
Negatively, there were 6.6 million jobless claims in the past week, a fresh record over the 3.2 million the U.S. saw last week, indicating the country is in recession.
Wall Street’s tone seemed skewed more towards the idea that a strong oil market — beneficial for the more oil-centric U.S. economy than it’s been in years past — is outweighing the jobs negative.
Here’s what Wall Street had to say.
Mike Loewengart, Head, Investment Strategy, E*Trade:
"As the markets are starting to wake up, they seem to be looking past the brutal jobless claims report as turbulence in the labor market is likely already baked in for the foreseeable future,”
Scott Knapp, Chief Market Strategist, CUNA Mutual Group:
“Since the U.S. is such a big net exporter of energy, this is having ripple effects throughout multiple industries across the U.S. economy,”
Seema Shah, Chief Strategist, Principal Global Investors:
“As the timeliest indicator to assess the depth of the downturn and also to catch the earliest signs of recovery, the doubling of jobless claims will fill investors with a sense of unease about the outlook. Not only was the number worse than expected, but with lockdowns becoming stricter and being extended, we should anticipate further surges in jobless claims over the coming weeks. Rising jobless numbers suggest that productive capacity is being eroded, so when self isolation measures are eventually lifted, economic activity will take that much longer to get back on its feet. The chances of a V-shape economic recovery are fading. I do think, though, that the market rout is not yet over, with movements likely to be influenced by still-rising infection rates and steady flow of negative economic data and earnings forecasts over the coming weeks.”
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