REUTERS/Brendan McDermid/File Photo/File Photo
- US stocks closed higher Thursday, snapping a three-day losing streak.
- New jobless claims hit another pandemic-era low, signalling the economic recovery remains on track.
- Cryptocurrencies were hammered Thursday following Elon Musk's reversal on Tesla accepting bitcoin as payment.
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US stocks closed higher Thursday, snapping a three-day losing streak, as new jobless claims hit another pandemic-era low.
All three major stock indexes ended higher, with the Dow finishing up over 430 points.
Jobless claims totaled an unadjusted 473,000 last week, the Labor Department said Thursday, lower than the median estimate of 490,000 from economists surveyed by Bloomberg.
The reading marks the fourth decline in five weeks and is the lowest since the pandemic froze economic activity in March 2020. The previous week's reading was revised to 507,000 from 498,000.
The upbeat economic data has caused investors to worry about inflation yet again. But Edward Moya of foreign exchange company Oanda said this is still a cause for celebration because it means that the labor market recovery has not completely stalled despite a shortage of workers and materials.
And while a jump in inflation will stoke bouts of volatility in the stock market, it's not likely to stop the overall rally, UBS on Thursday said.
The "latest volatility does not come as a surprise. But we also don't see it as signaling an end to the bull market," Mark Haefele, chief investment officer of global wealth management at UBS, wrote to clients.
Here's where US indexes stood at the 4:00 p.m. ET close on Thursday:
- S&P 500: 4,112.48, up 1.22%
- Dow Jones industrial average: 34,020.79, up 1.29% (433.13 points)
- Nasdaq composite: 13,124.99, up 0.72%)
Overnight, Elon Musk announced that Tesla will suspend bitcoin payments for vehicle purchases due to the negative environmental impact of cryptocurrency mining.
Bitcoin slipped as much as 15% following the news. Other cryptocurrencies slipped as well. Dogecoin tumbled 20% to trade around 40 cents. Litecoin fell 14%, while Ripple's XRP and Ethereum's ether lost 11%.
Elon Musk's abrupt reversal on bitcoin Wednesday evening conflicts not only with his previous stance by holding bitcoin himself and investing for Tesla but also with research from Cathie Wood's Ark Invest, which contends that bitcoin mining is actually beneficial for the environment.
Stocks linked to cryptocurrencies also slumped. Coinbase, MicroStrategy, and Square were all down by about 8-10%. Crypto-mining stocks including Riot Blockchain and Marathon Digital Holdings were both lower by 15% each.
Oil, gasoline, and diesel prices fell sharply after Colonial Pipeline said it would restart operations following a cyberattack last week that caused energy supply shortages in various eastern US states.
West Texas Intermediate crude slipped 3.65%, to $63.67 per barrel. Brent crude, oil's international benchmark, also fell 3.52%, to $66.88 per barrel, at intraday highs.
Gold rose 0.50% to $1,826.88 per ounce. The precious metal rebounded after seeing its worst single-day selloff in two and a half months on Wednesday.