U.S. Weekly Unemployment Claims Jumped to 219K, Well above Forecast

U.S. stocks opened mostly lower today after a report from the Labor Department showed that weekly jobless claims climbed higher than anticipated. The Dow Jones Industrial Average (DJIA) was down 0.72% soon after the opening bell, while the S&P 500 (SPX) slipped 0.65% and the Nasdaq Composite (COMP) fell 0.55%. Initial jobless claims jumped to 219,000 during the 7-day stretch ending Oct.1, the Labor Department said Thursday. That's above the 203,000 of new claims that economists polled by the Wall Street Journal had forecast, with investors worrying that layoffs may be rising as the Fed aims to cool the economy and high inflation through aggressive rate hikes.

Global oil supply is set to tighten, intensifying concerns over soaring inflation after the OPEC+ group of nations announced yesterday its largest supply cut since 2020 ahead of European Union embargoes on Russian energy supplies.

Corporatewise, Elon Musk and Twitter (TWTR) may reach an agreement to end their litigation in coming days, clearing the way for Musk to close his $44 billion deal for the social media platform. According to Reuters, Apollo Global Management and Sixth Street Partners are no longer in talks to finance the deal.

European markets are trading mostly lower today. The Stoxx Europe 600 Index declined 0.71%, The British FTSE 100 fell 1% while the French CAC 40 Index eased by 1.05%, and German DAX gave up 0.6%.

In an unprecedented move, ratings agency Fitch downgraded the outlook for the British government’s credit rating to 'negative' from 'stable', days after a similar action from rival Standard & Poor's. Britain's battered pound will be around 3.6% stronger in a year, according to a Reuters poll in which analysts were divided, however, on whether the currency would reach parity with the U.S. dollar by year-end.

The S&P Global Eurozone construction PMI rose to 45.3 in September from 44.2 in the previous month, recording contraction for the fifth straight month. The S&P Global/CIPS UK construction PMI climbed to 52.3 in September from 49.2 in the prior month.

Passenger car registrations in France unexpectedly surged 5.5% YoY to 141,142 units in September, while construction PMI rose to 49.1 in September from 48.2 in August. German construction PMI, however, declined to 41.8 in September from 42.6 in August, while factory orders in Germany plunged 2.4% MoM in August.

Elsewhere, Asian markets finished their today’s sessions mostly higher. Japan’s Nikkei 225 rose 0.7%, while Australia’s S&P/ASX 200 rose 0.03%, and India’s BSE Sensex gained 0.6%. However, Hong Kong’s Hang Seng Index fell 0.42%.

The S&P Global India services PMI eased to 54.3 in September from August’s reading of 57.2, while composite PMI fell to 55.1 from 58.2. The S&P Global Hong Kong’s PMI also declined to 48.0 in September from 51.2 in August. The Australian trade balance surplus narrowed to a 6-month low of AUD 8.32 billion in August 2022 versus a revised AUD 8.97 billion in July.