Stocks firmed Thursday despite a sharp spike in unemployment claims last week and ahead of a speech where President-elect Joe Biden will unveil hefty new government spending to help the economy weather Covid-19 and measures to speed up vaccinations.
The package is said to be worth up to several trillion dollars and include a proposal for additional $1,400 in stimulus checks for individuals.
The Russell 2000 index of small-cap stocks was up 2.37% ahead of the market close. The DJIA and tech-heavy Nasdaq trailed but were mostly in positive territory. ViacomCBS hit its highest point yet since the merger a year ago, up 8.3% at $46.69. A series of bullish reports this week touted its strength in streaming subscriber growth, digital advertising and the upcoming launch of Paramount+.
Lionsgate was also standout, up more than 11% at $13.49. Starz CEO Jeff Hirsch touted streaming growth on CNBC Thursday noting an inflection point last quarter when the company’s global OTT subscribers outpaced linear subs. “The next 24 months are going to be really exciting for our business,” he said.
Wall Street is generally abuzz with streaming chatter as showbiz earnings are set to kick off next Tuesday – Jan. 19 — with Netflix first up.
Pandemic-ravaged exhibitors were lively as Cinemark, Marcus and Imax rose 9%, 7% and 4% respectively. AMC Entertainment and National CineMedia gained 2%.
Tech stocks softened again. Investors continue to ponder the short term loss of a “Trump bump” for Twitter and other social media platforms that have banned the president over the past week for inciting violence – and the longer term fallout for Internet and tech in terms of antitrust and regulatory action. Twitter is down by 3%, Facebook by about 2% and Snap more sharply, by 7%. Google parent Alphabet, Apple and Amazon are also lower.
The market tends to be forward looking — trying to push beyond job losses, political violence that exploded last week, the ongoing spike in Covid cases and impeachment, to what will hopefully become a more robust vaccine rollout and strong economic investment under Biden. He is scheduled to unveil his economic and stimulus plan at 7:15 pm ET.
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New claims for state unemployment benefits for the week end Jan. 9 hit 1.15 million with an additional 284,000 workers filing claims under the Pandemic Unemployment Assistance program, according to stats from the Department of Labor this morning.
Claims in California were the highest of any state at 181,576 — up 20,587 from the previous week — followed by Florida and New York. The Bureau of Labor Statistics reported last week that 140,000 jobs were lost in December, the first monthly drop since last spring as the pandemic renewed its grip.
There’s some concern that a planned impeachment trial could distract from a new administration’s key economic priorities. Congress is gearing up for a Senate trial of President Trump, who was impeached yesterday by the House for inciting a violent mob attack on the Capitol that resulted in five deaths.
In a statement late Wednesday, Biden said, “I hope that the Senate leadership will find a way to deal with their Constitutional responsibilities on impeachment while also working on the other urgent business of this nation.”
Outgoing Federal Reserve Chairman Jerome Powell told a virtual Q&A conference Thursday that the economy wouldn’t really recover until the virus was under control, but that a flood of fiscal and monetary support could help the nation back to its pre-pandemic strength sooner than anticipated.
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