US close: Stocks mixed as jobless claims surge

The Dow Jones Industrial Average ended the day with a marginal decline of 0.13%, settling at 34,945.47 points.

Meanwhile, the S&P 500 index registered a slight uptick of 0.12%, closing at 4,508.24, while the Nasdaq Composite also saw a modest increase of 0.07%, reaching 14,113.67.

In currency markets, the dollar was last up 0.04% on sterling at 80.57p.

However, it dipped 0.02% against the euro to last trade at 92.17 euro cents, and it declined 0.61% on the yen to change hands at JPY 150.44.

“The bounce in stocks has slowed dramatically, though the reasons to buy keep coming through,” said IG chief market analyst Chris Beauchamp earlier.

“First it was CPI, then retail sales and PPI, and now comes a fresh fall in oil prices and yields, the two chief bugbears of stocks in recent months.

“Jobless claims rose to their highest level since mid-August, another sign of a cooling in the US economy, and a further brick in the wall of expectations that the Fed is now on pause for the foreseeable future.”

Jobless claims surge as industrial production declines

In economic news, the number of Americans filing for unemployment claims surged in the week ended 11 November, reaching its highest level in nearly three months, according to the Labor Department.

Initial unemployment claims rose by 13,000, reaching 231,000, exceeding expectations for 220,000.

Continuing claims increased by 18,000 to 1.86 million in the previous week, marking their highest level in nearly two years and surpassing market forecasts of 1.84 million.

The prior week’s level was revised upward by 1,000 to 218,000, and the four-week moving average, designed to smooth out week-to-week fluctuations, stood at 220,250, reflecting an increase of 7,750 compared to the revised average from the prior week.

“Initial jobless claims are still at levels consistent with relatively few layoffs, but they are creeping higher, rising to a three-month high in the week ending 11 November,” said Nancy Vanden Houten at Oxford Economics.

“Meanwhile, continued claims continued their upward march in the week ended 4 November, rising to the highest level in nearly a year.

“The upturn in continued claims suggests that unemployed individuals are finding it more difficult to find new jobs, which would be consistent with a slower pace of hiring.”

Vanden Houten said the claims data were consistent with a job market that was cooling enough to keep rate hikes off the table but too strong to make rate cuts a consideration any time soon.

“The Fed is surely encouraged by recent inflation data but needs to see a further slowdown in the labour market and wage growth to be persuaded that inflation is on a sustainable path back to 2%.

“We expect that scenario to evolve only gradually and don’t expect the first rate cut until September of next year.”

Elsewhere, data from the Federal Reserve revealed that industrial production in the United States experienced a more significant decline than expected in October, primarily due to strikes in the auto industry affecting output.

Output contracted by 0.6%, following a revised 0.1% increase in September, with the initial estimate for September indicating a 0.3% gain.

Analysts had anticipated a milder decline of 0.3% for October.

Manufacturing output, specifically, fell by 0.7%, primarily due to a 10% decrease in the production of motor vehicles and parts.

The declines were attributed to the United Auto Workers (UAW) strikes at General Motors, Ford, and Stellantis-owned Chrysler factories from mid-September to the end of October.

Excluding the impact of motor vehicles and parts, manufacturing output would have seen a modest increase of 0.1%.

Commenting on the data, economist Kieran Clancy from Pantheon Macroeconomics said the end of the UAW strikes means manufacturing output will “likely mean-revert in November”.

“That said, the underlying trend is still more or less flat and is unlikely to improve substantially in the near term.

“Capital spending intentions are no longer falling sharply but remain depressed, and the external boost to activity implied by China’s manufacturing PMIs looks limited.”

Finally on data, manufacturing activity in the Philadelphia region showed signs of contraction again in November, though it was less severe than anticipated, according to the Philly Federal Reserve.

The current general activity index, which surveys approximately 250 manufacturers in the region each month, increased by 3.1 points but remained negative at -5.9.

Analysts had expected an unchanged reading compared to October’s -9, which had improved from September’s -13.5.

That marked the 16th negative reading in the past 18 months.

The Philly Fed noted that while 18% of manufacturers surveyed reported a contraction in activity, down from 35% the previous month, the proportion reporting an increase also decreased to 12% from 26%, with 70% indicating no change, up from 38%.

Breaking down the sub-indices, the survey said: “The indicator for shipments turned negative, while the indicator for new orders was positive but low”.

“The employment index suggests steady employment overall, and both price indexes indicate overall increases in prices,

“The future indicators suggest that firms’ expectations for growth over the next six months remain subdued.”

Thursday’s release contradicted the New York Fed’s Empire State manufacturing index on Wednesday, which rose to a seven-month high of 9.1 this month.

Walmart tumbles while Macy’s jumps on third-quarter numbers

In equities, Walmart declined 8.09% in response to the big-box retail giant’s less optimistic outlook for 2023, which came short of market consensus.

Walmart exceeded profit and sales expectations in the third quarter, but its forward-looking guidance weighed on investor sentiment.

Conversely, Macy’s jumped 5.71% after the department store chain surpassed Wall Street’s expectations for its third-quarter results.

The achievement was attributed to effective inventory management and improved profit margins, which resonated positively with investors.

Reporting by Josh White for Sharecast.com.

Dow Jones - Risers

Intel Corp. (INTC) $43.35 6.75%
McDonald's Corp. (MCD) $276.08 2.12%
Microsoft Corp. (MSFT) $376.17 1.76%
Travelers Company Inc. (TRV) $171.69 1.27%
JP Morgan Chase & Co. (JPM) $151.45 1.14%
Procter & Gamble Co. (PG) $152.82 0.93%
Salesforce.Com Inc. (CRM) $221.45 0.93%
Apple Inc. (AAPL) $189.71 0.90%
Johnson & Johnson (JNJ) $150.10 0.87%
Merck & Co. Inc. (MRK) $101.96 0.63%

Dow Jones - Fallers

Cisco Systems Inc. (CSCO) $48.04 -9.83%
Walmart Inc. (WMT) $156.04 -8.09%
Walgreens Boots Alliance, Inc. (WBA) $20.75 -3.74%
Chevron Corp. (CVX) $141.77 -2.60%
Amgen Inc. (AMGN) $269.00 -1.48%
Caterpillar Inc. (CAT) $248.21 -1.15%
3M Co. (MMM) $95.71 -1.15%
Boeing Co. (BA) $206.60 -1.01%
Home Depot Inc. (HD) $306.44 -0.57%
Goldman Sachs Group Inc. (GS) $336.67 -0.28%

S&P 500 - Risers

Intel Corp. (INTC) $43.35 6.75%
Macy's Inc. (M) $13.33 5.71%
Intuitive Surgical Inc. (ISRG) $304.00 3.68%
Gen Digital Inc. (GEN) $20.40 3.24%
Stryker Corp. (SYK) $291.55 2.79%
Allstate Corp (The) (ALL) $134.75 2.42%
Everest Group (EG) $399.31 2.38%
Abbott Laboratories (ABT) $100.26 2.31%
General Electric Co. (GE) $118.94 2.27%
Southern Co. (SO) $70.22 2.18%

S&P 500 - Fallers

Cisco Systems Inc. (CSCO) $48.04 -9.83%
Walmart Inc. (WMT) $156.04 -8.09%
Bath & Body Works, Inc. (BBWI) $30.10 -7.38%
Bread Financial Holdings, Inc. (BFH) $26.34 -6.60%
Carmax Inc. (KMX) $64.15 -5.56%
Foot Locker Inc. (FL) $20.83 -5.32%
FMC Technologies Inc. (FTI) $20.14 -5.13%
Illumina Inc. (ILMN) $95.20 -4.96%
Helmerich & Payne Inc. (HP) $37.02 -4.93%
Sl Green Realty Corp. (SLG) $33.56 -4.82%

Nasdaq 100 - Risers

Intel Corp. (INTC) $43.35 6.75%
Intuitive Surgical Inc. (ISRG) $304.00 3.68%
Gen Digital Inc. (GEN) $20.40 3.24%
Mercadolibre Inc. (MELI) $1,469.16 1.84%
Henry Schein Inc. (HSIC) $68.79 1.78%
Qurate Retail Inc. (QRTEA) $0.66 1.76%
Microsoft Corp. (MSFT) $376.17 1.76%
Alphabet Inc. Class A (GOOGL) $136.93 1.72%
Alphabet Inc. Class C (GOOG) $138.70 1.70%
Seagate Technology Plc (STX) $75.61 1.42%

Nasdaq 100 - Fallers

Cisco Systems Inc. (CSCO) $48.04 -9.83%
Illumina Inc. (ILMN) $95.20 -4.96%
Dollar Tree Inc (DLTR) $113.70 -4.23%
Dish Network Corp. (DISH) $3.33 -3.90%
Tesla Inc (TSLA) $233.59 -3.81%
Walgreens Boots Alliance, Inc. (WBA) $20.75 -3.74%
Hasbro Inc (HAS) $45.11 -3.67%
Baidu Inc. (BIDU) $109.29 -3.15%
Ross Stores Inc. (ROST) $120.15 -3.08%
Costco Wholesale Corp. (COST) $578.52 -3.06%