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By Alex
Eule | Thursday, September 24 The
Pandemic Divide. Stocks rose modestly on
another day of contrasting data points about the economy. While jobless
claims rose slightly on the week to 870,000, new home sales topped 1 million
for the first time in 14 years. It's a clear indication of the vastly
different effects the pandemic is having across the country. Sales of new
single-family homes were up 4.8% last month, bringing the seasonally
adjusted rate to 1.01 million. The number was far better than expected.
Economists had actually forecast a decline in August, to 898,000. My
colleague Brian Hershberg has more on the numbers here. Brian also
covered the stubborn jobless data. First-time jobless claims rose
4,000 in the latest week, while economists had expected a small decline.
There were some positive signs, though, including a 3 million claim drop
in the number of people claims for Pandemic Unemployment Assistance. The S&P
500 ended
the day up 0.3%. Hopes for
another coronavirus stimulus package continue to swirl, even as lawmakers
remain far apart on price. The Wall Street Journal reported
today that House Democrats are putting together a $2.4 trillion
package, a number that could still be too high to gain support from
congressional Republicans or the White House. Stocks have
generally been falling in the absence of the deal. The S&P 500 is down 9%
from its early September highs. But Barron's Randall
Forsyth writes
today that stocks might have to fall further to force a compromise
in Washington. Here's Randy: One doesn’t
have to be cynic to point out the unusual speed with which the Cares Act was
put together by the Trump administration and the Democratic leadership in
Congress came against the backdrop of the stunning March drop in the stock
market. By contrast, the urgency to come together on a new package has been
notably absent even with the S&P 500 ending Wednesday 9.6% below its peak
reached three weeks earlier, just short of the arbitrary definition of a
correction of 10%. The House
has managed to pass legislation to avoid a government shutdown on Oct. 1, and
the Senate is expected to take up the measure in coming days. It may take
steeper drops in the stock market to get Congress and the Administration to
move on a deal to extend pandemic relief while consumers tap savings and
credit cards to pay the bills. |
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DJIA: +0.20% to 26,815.44 The Hot
Stock: Darden
Restaurants +8.1% Best Sector:
Utilities +1.1% |
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