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The Dow Jones fell more than 300 points this morning after the U.S. Labor Department revealed the number of people seeking unemployment benefits was 10% higher than expected.
Meanwhile, many leading financial pundits are starting to raise concerns about a bigger financial contraction than previously forecast. Here's everything moving the Dow today.
First, the numbers from Wednesday for the Dow, S&P 500, and Nasdaq:
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Now here's a closer look at what I'm following today. These are the most important market events and stocks.
The Top Stock Market Stories for Thursday
- U.S. Federal Reserve Chair Jerome Powell warned that the United states will need even more stimulus to stop from falling into a deeper recession. However, Powell has not committed to negative interest rates to boost the U.S. economy. Goldman Sachs Group Inc. (NYSE: GS) sees the scenario for reconsideration. The Wall Street bank said that if the United States experiences a setback in the economy due to a second wave of coronavirus, rates may need to go negative. We will continue to report on this and what investments are best for a negative-interest rate environment.
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- This morning, the U.S. Labor Department will release the latest figures on government jobless claims. The agency said that first-time jobless claims hit 2.98 million, far above the estimated 2.7 million people. The last seven weeks show that about 33.5 million people have filed for unemployment insurance.
- The World Health Organization now says it could take five years before the coronavirus pandemic is under control. Dr. Soumya Swaminathan, the WHO's chief scientist, told FT yesterday: "I would say in a four to five-year timeframe, we could be looking at controlling this." The latest news comes as more than 4.3 million people have contracted the disease. We've experienced nearly 300,000 deaths tied to COVID-19.
Stock to Watch Today: MMM, DKNG, SBUX
- Shares of 3M Co. (NYSE: MMM) were off 1% this morning after the company gave some updates on its numbers. The firm said that its sales dropped by 11% in April. The ongoing surge in demand in healthcare equipment like masks has offset its ability to produce other products. Its transportation and electronics sales fell by 20% for the month, while industrial and safety sales were off 11%.
- Shares of DraftKings (NASDAQ: DKNG) surged 7% this morning on two positive developments. First, billionaire George Soros announced that he had taken a massive stake in the online gambling firm with 2.7 million shares. In addition, Susquehanna Financial initiated coverage of the stock and predicted that it will be the leader of an online gambling market poised to hit as much as $40 billion in the next 10 years.
- This could be a major sign of the times going forward. In a letter to landlords, Starbucks Corp. (NASDAQ: SBUX) COO Roz Brewer asked them to lower rents for the year ahead. Citing the economic downturn fueled by COVID-19, the company asked landlords to "to support modified operations and adjustments to lease terms and base rent structures, so we can withstand this uncertainty together."
Why Startups Can Have an Edge During a Recession
Uber, Airbnb, Slack, Pinterest, and Venmo have something big in common – something other than their big names.
These startups were founded during the last recession.
And now, some of the most iconic companies of our time could launch into Fortune 500s during days like today.
About the Author
Garrett Baldwin is a globally recognized research economist, financial writer, and consultant with degrees from Northwestern, Johns Hopkins, Purdue, and Indiana University. He is a seasoned financial and political risk analyst, with a focus on stocks, hedge funds, private equity, blockchain, and housing policy. He has conducted risk assessment projects for clients in 27 countries, and consulted on policy and financial operations for some of the nation's largest financial institutions, including a $1.5 trillion credit fund, a $43 billion credit and auto loan giant, as well as two of the largest Wall Street banks by assets under management.
Garrett joined Money Map Press as an economist and researcher in 2011, specializing in alternative strategies with an emphasis on fundamental and technical analysis.