Stock America closed in positive territory following the volatile session on Thursday. A day earlier, the Dow Jones indicator lost 1.92%, the S&P 500 – 2.37%. The Nasdaq fell 3.02%. The pressure on the market was exerted by disagreements in Washington over additional stimulus measures for the American economy in connection with the coronavirus pandemic, as well as an increase in the number of cases of COVID-19 infection in Europe and some US states.
Amid a lack of new economic stimulus, Goldman Sachs analysts have lowered their forecast for US GDP growth in the fourth quarter of 2020 to 3% from 6% in quarterly terms, CNBC reported. “After the last round of additional payments to the unemployed, which are now being made, other budgetary incentives will most likely have to wait until 2021,” said Jan Hatzius, chief economist at Goldman Sachs.
Yesterday, the US Department of Labor announced that the number of Americans applying for unemployment benefits for the first time in the week ended September 19 was 870,000. According to the revised data, a week earlier the number of requests was 866 thousand, and not 860 thousand, as originally reported. Experts expected the indicator to drop to 840 thousand, according to data from Trading Economics.
“As the Fed reduces confidence in itself by continuing to highlight the ineffectiveness of monetary policy and asking for budget support, weak data will have a large impact on risky assets,” said strategist at Evercore ISI
Earlier, US Federal Reserve Chairman Jerome Powell said that the increase in budget spending will allow the Fed to achieve faster targets in terms of employment and stable inflation. The power of fiscal stimulus is greater than any other, Powell said.
At the same time, new home sales in the United States in August rose 4.8% from the previous month to 1.011 million at an annual rate, the country's Department of Commerce said. The indicator peaked since September 2006 amid the market's recovery from the pandemic crisis and record low mortgage rates, Trading Economics notes.
The Dow Jones Industrial Average rose 52.31 points (0.2%) to 26815.44 points.
Standard & Poor's 500 added 9.67 points (0.3%) to 3246.59 points.
The Nasdaq Composite rose 39.28 points (0.37%) – up to 10672.27 points.
Accenture Plc shares lost 7% on Thursday. The consulting company in the fourth fiscal quarter received adjusted earnings of $ 1.7 per share, revenue – $ 10.84 billion. Analysts at FactSet on average expected the first figure at $ 1.73 per share, the second – $ 10.93 billion.
CarMax Inc (NYSE: KMX). declined in price by 11%, despite the fact that the car dealer reported an increase in net profit in July-August to $ 1.79 from $ 1.4 per share. At the same time, experts predicted that the figure would drop to $ 1.1 per share.
BlackBerry Ltd. fell 1%, although the software maker's adjusted profit for the second fiscal quarter was $ 0.11 per share and exceeded analysts' expectations of $ 0.02 per share.
EW Scripps Co. jumped 7.6% after the media company announced its purchase of ION Media for $ 2.65 billion backed by Warren Buffett's investment firm Berkshire Hathaway (NYSE: BRKb).