US Stocks Rally After Jobless Claims Data Released
4:32 pm Thursday, May 20th, 2021
Stocks continued to recover today as buyers follow through on yesterday’s comeback effort, particularly in the large-cap growth stocks.
The S&P 500 information technology (+1.7%) and communication services (+1.5%) sectors, which were the only sectors that closed higher yesterday, and led today’s advance in part due to their mega-cap components. The cyclical energy (-0.9%), financials (-0.2%), and industrials (-0.1%) sectors traded lower.
Growth stocks have keyed off the decline in long-term interest rates today and potentially a fear of missing on further gains if this is the start of a bigger rebound rally. Time will tell on the latter. The 10-yr yield is down six basis points to 1.62%.
Separately, Cisco (NASDAQ:CSCO) closed higher by 0.72%, recovered from an early 4.5% decline following its earnings report, which featured better-than-expected results but relatively disappointing guidance.
In the retail space, Kohl’s (NYSE: KSS) fell 10.17%, L Brands (NYSE:LB), and BJ’s Wholesale (NYSE:BJ), were down sharply despite each beating EPS estimates.
U.S. Treasuries rallied on Thursday with the 5-yr note and longer tenors reclaiming their losses from Wednesday. The trading day started on a modestly higher note with the 30-yr yield reversing yesterday’s increase at the open. The next couple hours saw an extension of the gains that pressured the 30-yr yield to a fresh low for the week while the 10-yr yield stopped within a basis point of yesterday’s low.
Initial jobless claims for the week ending May 15 decreased by 34,000 to 444,000 (Briefing.com consensus 460,000). That is the lowest since March 14, 2020. Continuing claims for the week ending May 8 increased by 111,000 to 3.751 million. Continuing claims for the week ending May 8 increased by 111,000 to 3.751 million.
