US open: Stocks record early gains following jobs data
By Iain Gilbert
Date: Thursday 02 Jul 2020
(Sharecast News) - Wall Street stocks opened higher on Thursday as market participants digested a slew of data from the Department of Labor and some positive news regarding a coronavirus vaccine candidate.
As of 1535 BST, the Dow Jones Industrial Average was up 1.19% at 26,042.44, while the S&P 500 was 1.15% firmer at 3,151.56 and the Nasdaq Composite came out the gate 1.24% stronger at 10,280.33.
The Dow opened 307.47 points higher on Thursday, erasing losses recorded in the prior session despite "encouraging" clinical trial data from Pfizer and BioNTech for one of their Covid-19 vaccine candidates, although the S&P 500 and Nasdaq Composite continued to push higher.
Sentiment was continuing to be boosted by the clinical trial results at the open of the last day's trading for the week, with Pfizer and BioNTech providing hope to investors that normality could indeed return at some point. While the data had not yet been reviewed by a medical journal, meaning that it was still in the very early stages, market participants were seemingly excited by the progress in developing a drug to defeat Covid-19 all the same.
News that health officials in the US were planning to ramp-up the collection of blood plasma from recovered Covid-19 patients was also in focus. The Wall Street Journal, which cited people familiar with the discussions, said the talks were part of a large-scale effort to build supplies of the promising experimental treatment. According to some accounts, so-called convalescent plasma had proven to be the sole effective treatment during the catastrophic 1918 pandemic.
Investors were also digesting a flurry of data from the Department of Labor, including the closely-watched monthly non-farm payrolls report, which revealed that hiring in the States continued to recover at a faster-than-expected clip in June, resulting in a sharp drop in unemployment. According to the Department of Labor, non-farm payrolls in the US jumped by 4.8m in June - well ahead of the 3.0m expected and bringing the unemployment rate to 11.1%.
Also in focus, weekly jobless claims in the States continued to drift lower last week, but only slightly once again and by less than economists had forecast. According to the Department of Labor, initial unemployment claims for the week ending on 27 June decreased by 55,000 to reach 1.427m (consensus: 1.341m).
Elsewhere on the macro front, the US trade deficit widened by 9.7% in May to $54.6bn, according to the Bureau of Economic Analysis, with exports falling 4.4% to $144.5bn and imports declining 0.9% to $199.1bn.
Another report revealed business activity in the New York Metropolitan area moderated its contraction pace in June compared with May, according to the Institute for Supply Management. The ISM-New York Report on current business conditions improved significantly to 39.5 in June - up 20 points month-on-month.
Lastly, factory orders rose 0.8% in May to record their first growth in three months, according to the Commerce Department, well and truly short of the 9.7% increase expected by economists.
In the corporate space, shares of Tesla rocketed to a fresh record high on the back of better-than-expected delivery numbers for the second quarter.
Coty shares were up 5.09% at the bell after naming a new CEO and chairman.
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