23 Apr Another 4.4 Million People File for Unemployment Relief
Even in the midst of weak economic reports showing strong signs that the US is in a recession, the US stock market is climbing higher in early morning trading. I don’t see this rally continuing, as every time in recent weeks that the S&P 500 has clawed its way above 2800, it has been followed by a quick decline that takes the index beneath this critical level. With today’s rally once again taking prices above this level, I believe history will repeat itself and we will see stock prices fall in the near term. Of course, this is just a speculation. However, it has been the cycle we have seen happen several times now.
It was reported this morning that the number of Initial Jobless Claims for last week were 4,400,000. As more people seek financial help to get them through while businesses remain closed, the pressure to both remain socially distant and the opposing pressure of re-opening America continues to build. Americans have now filed more than 26,000,000 new claims for unemployment benefits since March 14th, making this the most difficult five weeks in the history of the labor market. With approximately 16% of American workers feeling the pain of layoffs and furloughs, the pressure is on to help businesses reopen. The opposing fear is a resurgence of new Covid-19 cases, which certainly could be the consequence of sending people back to work. Let’s hope for a safe and healthy return when people do go back into the workforce.
With mortgage bonds holding stable so far this morning, there remains little incentive to float for transactions that need to close soon.