[New York Stock Market] US Unemployment Worsens and Level Concerns Lead to Mixed Close... Dow Down 0.02%

[Image source=Reuters Yonhap News]

[Asia Economy Reporter Kwon Jae-hee] Major indices on the New York Stock Exchange closed mixed due to weak U.S. unemployment data and increased level concerns.

On the 11th (local time) at the New York Stock Exchange (NYSE), the Dow Jones Industrial Average fell 0.02% (7.1 points) from the previous session to close at 21,430.70.

The Standard & Poor's (S&P) 500 index rose 0.17% (6.5 points) to 3,916.38, and the tech-heavy Nasdaq index closed up 0.38% (53.24 points) at 14,025.77.

The market focused on U.S. unemployment data, new stimulus package discussions, and corporate earnings, but it appeared that the U.S. employment recovery remains slow.

The Department of Labor announced that the number of initial jobless claims last week decreased by 19,000 from the previous week to 793,000 (seasonally adjusted). This exceeded the Wall Street Journal (WSJ) forecast of 760,000.

This confirmed that the labor market is still struggling.

The market is also paying attention to the $1.9 trillion stimulus package promoted by U.S. President Joe Biden.

The Democratic Party is accelerating legislation by revealing the outline of the related bill.

Expectations that accommodative monetary policy will continue are also supporting the stock market.

On the previous day, Jerome Powell, Chair of the U.S. Federal Reserve (Fed), reiterated that "it is important to patiently maintain accommodative monetary policy."

Mary Daly, President of the San Francisco Federal Reserve Bank, also stated in an interview with WSJ, "Tapering (reduction of bond purchases) will not be implemented this year," and argued that "premature withdrawal of accommodative policy is risky."

Corporate earnings that have been much better than market expectations are also supporting stock price gains.

According to CNBC, more than 80% of S&P 500 companies that have reported earnings so far have posted profits exceeding expectations.

However, as these factors have led major indices to repeatedly hit all-time highs, level concerns have also increased.

There are claims that tangible evidence of economic improvement is needed for stock prices to rise again with momentum.

There are also ongoing concerns that a sharp rise in U.S. Treasury yields due to large-scale stimulus could burden the stock market.

The Congressional Budget Office (CBO) analyzed in a report on the same day that even excluding the additional $1.9 trillion stimulus package, the fiscal deficit for the 2021 fiscal year could reach $2.3 trillion.

By sector on the day, technology stocks supported the market with a 1.09% rise, while energy fell 1.52%.

At the Chicago Board Options Exchange (CBOE), the volatility index (VIX) fell 3.37% from the previous trading day to 21.25.

This content was produced with the assistance of AI translation services.