US: S&P, Nasdaq finish lower, ending rally ahead of jobs report

[NEW YORK] Wall Street stocks finished mostly lower Thursday, ending a rally after weekly labour data showed another spike in unemployment ahead of the official May jobs report.

The Dow Jones Industrial Average mustered a 0.1 per cent gain to close the day at 26,281.82.

The broad-based S&P 500 fell 0.3 per cent to 3,112.35, while the tech-rich Nasdaq Composite Index shed 0.7 per cent to 9,615.81.

Another 1.9 million people applied for jobless claims last week, the Department of Labor reported, taking the total to more than 42 million in the wake of coronavirus shutdowns.

The figures were a grim omen for Friday, when the Labor Department releases the all-important May jobs report that will likely show national unemployment increasing to closer to 20 per cent from 14.7 per cent in April, the highest unemployment rate in 90 years.

Stocks have risen considerably from March lows despite a grim near-term economic outlook as investors cheer moves by states to reopen economies together with aggressive US Federal Reserve policies to keep financial markets flush with cash.

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The European Central Bank surprised with a bigger-than-expected boost to their pandemic emergency bond-buying scheme, adding 600 billion euros and extending it until mid-2021.

The market "went a little overboard," said Peter Cardillo of Spartan Capital Securities, adding that, "Tomorrow's unemployment numbers are going to be ugly."

American Airlines surged 41.1 per cent as it announced it would add more flights in July on improving demand, suggesting the industry had seen the worst of the hit from the coronavirus shutdowns.

Delta Airlines and United Airlines both jumped around 15 per cent.

EBay surged 6.3 per cent as it lifted its full-year profit and revenue targets, citing surging traffic on its online selling platform.

AFP