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Stocks extend rally after Senate approves stimulus bill, jobless claims surge
26-Mar-20 16:15 ET
Dow +1351.62 at 22552.23, Nasdaq +413.24 at 7796.89, S&P +154.51 at 2630.07

https://www.briefing.com/stock-market-update

[BRIEFING.COM] The S&P 500 extended its weekly rally by 6.2% on Thursday after the Senate approved the $2 trillion fiscal stimulus package for the economy, which saw a record surge in weekly jobless claims. The Dow Jones Industrial Average rose 6.4%, the Nasdaq Composite rose 5.6%, and the Russell 2000 rose 6.3%.

Initial claims for the week ending March 21 increased by 3.001 million to 3.283 million (Briefing.com consensus 525,000), which was above most expectations but also unsurprising given the slew of economic shutdowns aimed at slowing the rate of coronavirus infections. For the market, and Congress, it quantified how bad the situation has been for American workers.

House Speaker Pelosi (D-CA) said the stimulus bill will be passed tomorrow by voice vote with "strong bipartisan support" despite some speculation that objecting members would request a roll call vote, which would further delay its passage. The impending fiscal relief, then, provided investors some reassurance while doing some quarter-end rebalancing.

The S&P 500 closed at session highs and up 20.0% from its Monday intraday low. All 11 S&P 500 sectors posted strong gains today between 4.3% (consumer discretionary) and 8.4% (utilities). Oil prices ($22.60, -1.93, -7.9%) were unable to catch a bid, though, partly due the oil industry not being included in this stimulus bill.

Prior to the open, Fed Chair Powell reiterated in an NBC "Today Show" interview that the Fed isn't going to run out of ammunition and will continue to provide credit to places that need it. The reminder that the Fed will be on the market's side in the foreseeable future was another positive consideration for the market.

In corporate news, semiconductor stocks drew support from Micron's (MU 44.79, +2.29, +5.4%) encouraging quarterly results and guidance. Henry Schein (HSIC 53.56, +3.53, +7.1%) was among the latest companies contributing to the fight against COVID-19 with an antibody rapid blood test for health care professionals.

U.S. Treasuries finished the session on a higher note, as the record number of unemployment claims reminded bond investors of the negative macro environment. The 2-yr yield declined four basis points to 0.26%, and the 10-yr yield declined five basis points to 0.81%. The U.S. Dollar Index fell back below 100.00, finishing 1.6% lower at 99.43.

Reviewing Thursday's economic data:

Initial claims for the week ending March 21 increased by 3,001,000 to 3,283,000. That is the highest seasonally adjusted number for initial claims by many miles. The prior record was 695,000 in October 1982. Continuing claims for the week ending March 14 increased by 101,000 to 1,803,000, but that number will skyrocket next week as well.
The key takeaway from the report is that it underscores for everyone how much worse the current economic situation is than anything else experienced in this modern age. It is a stark reflection that this time is different.
The third estimate for Q4 GDP showed a 2.1% annualized rate of growth that was in-line with the second estimate and the Briefing.com consensus estimate. Similarly, the GDP Price Deflator was left unchanged at 1.3%, as expected.
The key takeaway from the report is that it is inconsequential at this juncture. That would be the effective takeaway in normal times (we're less than a week away from the end of Q1), but things are no longer normal as the first quarter is ending with the U.S. economy in shutdown mode to help stop the spread of COVID-19.
The advance goods trade deficit totaled $59.89 bln in February after a $65.9 bln deficit in January. Advance retail inventories decreased 0.3% in February after decreasing 0.1% in January. Advance wholesale inventories decreased 0.5% in February after decreasing 0.5% in January.

Looking ahead, investors will receive Personal Income and Spending for February, PCE Prices for February, and the final University of Michigan Index of Consumer Sentiment for March on Friday.

Nasdaq Composite: -13.1%
S&P 500: -18.6%
Dow Jones Industrial Average: -21.0%
Russell 2000: -29.3%

Market Snapshot
Dow 22552.23 +1351.62 (6.38%)
Nasdaq 7796.89 +413.24 (5.60%)
SP 500 2630.07 +154.51 (6.24%)
10-yr Note +3/32 0.833
NYSE Adv 2578 Dec 382 Vol 1.6 bln
Nasdaq Adv 2715 Dec 561 Vol 3.9 bln

Industry Watch
Strong: Utilities, Real Estate, Health Care
Weak: Consumer Discretionary

Moving the Market

-- S&P 500 climbs more than 6%, extending its rally to 20% from its recent low

-- Weekly jobless claims surged to a record 3.283 million

-- Senate approved $2 trillion stimulus bill, as expected; House will vote on bill tomorrow

WTI crude loses nearly 8% despite equity rally
26-Mar-20 15:25 ET
Dow +934.30 at 22134.91, Nasdaq +296.37 at 7680.02, S&P +115.67 at 2591.23

[BRIEFING.COM] Little has changed in the market with the S&P 500 continuing to trade higher by 4.5%. The small-cap Russell 2000 is up 4.8%.

One last look at the S&P 500 sectors shows the utilities sector (+7.2%) still leading the advance, followed by the real estate sector (+5.9%). The consumer discretionary sector (+2.7%) is up the least, falling behind the materials sector (+3.3%).

WTI crude futures settled down $1.93 (-7.9%) to $22.60/bbl, as investors remained bearish due to the well-documented struggles with the market. The fact that the oil industry wasn't included in the stimulus bill may have added to the poor sentiment.