Stocks slip after new batch of jobless claims

Stocks slip after new batch of jobless claims

Stocks slipped Thursday as a new batch of weekly jobless claims briefly interrupted a steady rally for Wall Street.

The Dow Jones Industrial Average opened with a loss of 0.3 percent, falling roughly 80 points as the stock market opened Thursday. The Nasdaq composite fell roughly 0.1 percent while the S&P 500 index sunk 0.3 percent.

The Thursday dip came an hour after the Department of Labor reported that 1.9 million American filed new claims for jobless benefits in the final week of May, lower than previous weeks by higher than economists had expected. 

More than 42 million Americans have applied for unemployment insurance benefits since the spread of COVID-19 forced thousands of businesses to close in mid-March.

“The news is a net positive, but we should not slap a ruler on the jobless claims trend and expect it to keep dropping at a steady rate. The evidence of unemployment spreading to other industries and larger companies is clear, and that may slow, or even temporarily reverse, our progress,” said Robert Frick, corporate economist at Navy Federal Credit Union, in a Thursday statement.

The May jobs report, set to be released Friday, could show an unemployment rate as high as 20 percent, well above the record set during the Great Recession slightly above 10 percent. Unemployment is believed to have peaked near 25 percent during the Great Depression.