The Dow Jones average showed a 1.5% increase at the start of trading on Thursday morning, with a 360-point rise. The S&P 500 and the Nasdaq also saw increases of 1.3% and 1% respectively. This positive movement is in contrast with the alarming news that 6.6 million Americans have filed for unemployment in the past week.
Last week, the US labor force experienced the second-highest number of unemployment claims since 1967, when the Department of Labor began tracking this data. Over the past three weeks, a total of 16.8 million Americans have applied for unemployment benefits, equating to around 10% of the entire US workforce.
Stunning news: 6.61 million unemployment claims in one week. That’s 16 m. claims in 3 weeks. Nothing like this since the Great Depression. #joblessclaims
— Suzanne Trimel (@STrimel) April 9, 2020
Despite these concerning numbers, various external factors have helped buoy the stock market. The Federal Reserve announced a new lending program on Thursday to support the economy, earmarking at least $2.3 trillion for this purpose. Notably, $600 billion has been allocated for state, city, and municipal governments.
Speaking on these measures, Jerome Powell stated, “The Fed’s role is to provide as much relief and stability as we can during this period of constrained economic activity, and our actions today will help ensure that the eventual recovery is as vigorous as possible.”
Furthermore, stocks saw a modest rise on Wednesday following Senator Bernie Sanders’ decision to suspend his presidential campaign. Sanders’ proposals for debt forgiveness and tuition-free college had raised concerns among economists, so the end of his campaign likely instilled a sense of confidence among investors.
