In an intra Day note to investors, Gorilla Trades strategist Ken Berman, while commenting on the weekly number of new jobless claims, said:
The major indices are all in the green at midday despite another highly volatile pre-market session. The energy sector has been the clear winner of the morning session, but most of the key sectors are sporting gains despite the grim COVID-19 numbers. The price of crude oil surged higher overnight together with global equities, despite yesterday’s huge U.S. inventory build, on reports that China started buying oil for its strategic reserve. The commodity jumped even higher after President Trump told the press that Saudi Arabia and Russia are set to end the damaging price war and the two countries will cut their supply by 10 million barrels a day.
Number Of New Jobless Claims Hits Another Record High
The weekly number of new jobless claims was much higher-than-expected for the second week in a row, hitting another record high of 6.648 million, with the total of the past two weeks being over 10 million claims. The Challenger job cuts estimate more than tripled on a yearly basis, also painting a gloomy picture of the job market ahead of tomorrow’s government jobs report. The trade deficit was narrower than the consensus estimate yet again, confirming the sharp downturn in global trade and the drop in commodity prices.
Dow: 21,203, +260 or 1.2%
S&P 500: 2,509, +38 or 1.6%
Nasdaq: 7,451, +90 or 1.2%
Russell 2000: 1,089, +17, or 1.6%
Market breadth is still far from being convincing, with advancing issues outnumbering decliners by only a 6-to-5 ratio on the NYSE. 51 stocks hit new 52-week lows on the NYSE and the Nasdaq, and only 2 stocks hit new 52-week highs. The major indices have been trading above their VWAPs (Volume-Weighted Average Price) for most of the morning session, indicating intraday buying pressure. The recently weak energy, industrial, utilities, and financial sectors bounced back by the most in early trading, but on a negative note, tech stocks failed to maintain their relative strength and most sectors remain well below their weekly highs. Stay tuned!