2 Tailwinds Driving Stocks Thursday

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Stocks held onto their gains Thursday, as investors looked past ugly economic data. Additional Federal Reserve stimulus for small businesses and a reported OPEC agreement on oil production cuts are keeping investors in the stock market. 

All three major U.S. indices rose Thursday, with the S&P 500 maintaining its 2% gain by midday.

Weekly jobless claims matched a recent record of 6.6 million, prompting many economists to assume the U.S. likely has a current unemployment rate in the mid-teens in percentage terms. The market had priced in a recession weeks ago and stocks are now 25% off of their 2020 lows, as the market enjoys what it sees as constant and potentially effective stimulus coming from the Federal Reserve and the rest of the government. 

The Federal Reserve added $2.3 trillion to its lending program to small businesses, households and municipalities. This can pad the recession and enable a fairly fast recovery when the Coronavirus fades. 

The Fed’s action is pressuring the 10 year treasury yield, which fell to 0.72%. 

OPEC’s agreement to cut oil production amid a virus-driven oil price rout in 2020 is lifting crude oil prices by 4%. 

Smaller and more indebted oil companies saw a bigger boost to their share prices tan did large oil companies. When the oil market was running hotter in the morning, here were the stock moves of these oil companies: 

Occidental ( (OXY) - Get Report) - Get Report: +14%

Halliburton ( (HAL) - Get Report) - Get Report: _10%

Apache ( (APA) - Get Report) - Get Report: +28%

Exxon Mobil ( (XOM) - Get Report) - Get Report: +4.7%

Chevron ( (CVX) - Get Report) - Get Report: +19%

BP: +0.6%

Also of note, Starbucks  (SBUX) - Get Report said its second quarter earnings per share will come in at 32 cents, not 34 cents, which it had initially forecasted, exemplifying the struggles the consumer discretionary sector is experiencing as a result of the virus. 

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