Stocks Mixed Amid Continued Somber Jobs Data…..

U.S. equities finished mixed, as investors received another read on jobless claims that continued to illustrate the severely hampered employment front, along with a with a mixed bag of results from PepsiCo, Kraft Heinz, Uber Technologies and MGM Resorts. Continued COVID-19 vaccine rollout optimism and improved virus case trends appeared to keep the losses limited. Moreover, monetary and fiscal support is expected to remain highly accommodative after Fed Chairman Jerome Powell suggested yesterday that the employment recovery still needs undivided attention on multiple fronts. Treasuries dipped, modestly lifting yields, and the U.S. dollar was flat, while gold fell, and crude oil prices are saw modest declines. Europe finished mixed as the markets continued to assess the recent global equity market rally, while markets in Asia also diverged in light volume.

The Dow Jones Industrial Average fell 7 points to 31,431, while the S&P 500 Index was up 7 points (0.2%) at 3,916, and the Nasdaq Composite gained 53 points (0.4%) to 14,026. In heavy volume, 1.0 billion shares were traded on the NYSE and 10.7 billion shares changed hands on the Nasdaq. WTI crude oil lost $0.44 to $58.24 per barrel. Elsewhere, the Bloomberg gold spot price tumbled $16.47 to $1,826.42 per ounce, and the Dollar Index—a comparison of the U.S. dollar to six major world currencies—was flat at 90.37.

Jobless claims remain uncomfortably high…..

Weekly initial jobless claims came in at a level of 793,000 for the week ended February 6, above the Bloomberg estimate of 760,000, and compared to the prior week’s upwardly revised 812,000 level. The four-week moving average declined by 33,500 to 823,000, and continuing claims for the week ended January 30 fell by 145,000 to 4,545,000, but north of estimates of 4,420,000. The four-week moving average of continuing claims dropped by 157,500 to 4,748,750.

The level of unemployment claims continue to be painfully high illustrating comments yesterday from Federal Reserve Chairman Jerome Powell who remained dovish and painted a sobering picture of the jobs market. Powell noted that the U.S. is “a long way” from being back to where the country needs to be regarding employment, despite the headline unemployment rate that he said “dramatically understated” the damage from the pandemic.

He reiterated the Central Bank’s stance that it will not consider raising its benchmark short-term interest rate target and hold off on adjusting its $120 billion monthly asset purchases until it has seen substantial further progress on employment and inflation. Powell also noted that it will take more than supportive monetary policy and that it could take “many years” to overcome scars from long-term unemployment.

Treasuries dipped, as the rate on the 2-year note was little changed at 0.11%, while the yields on the 10-year note and the 30-year bond rate gained 3 basis points to 1.16% and 1.95%, respectively.

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