US stocks tick higher as virus aid deal uncertainty rules

US stocks tick higher as virus aid deal uncertainty rules

The main United States stock indexes were holding onto to slim gains as better-than-expected news on the economy collided and waffling hopes that Congress will pass a new fiscal stimulus package soon.

The Dow Jones Industrial Average was up 0.43 percent at 27,897.38 in late morning trading on Wall Street.

The S&P 500 – a gauge for the health of US retirement and college savings reports – was up 0.45 percent, while the tech-heavy Nasdaq Composite Index was 0.84 percent to the plus side.

On Wednesday, the S&P 500 closed out its best two-quarter gain since 2009.

Whether those gains hold, rise, or retreat before yearend hinges on several factors that will play out in the fourth quarter which kicks off on Thursday.

The trajectory of the pandemic is one worry overhanging investors with COVID-19 infections currently increasing in more than half of the 50 states.

Concerns also surround the results of the US presidential election on November 3, including the spectre of a contested outcome.

And there is deep uncertainty over whether the White House and Democrats in Congress can find common ground for a new round virus relief aid that economists are warning is needed to keep struggling Americans afloat and the economic recovery on track.

The White House presented a new pandemic relief bill to House Democrats worth more than $1.5 trillion, President Donald Trump’s Chief of Staff Mark Meadows said on Wednesday. The bill includes a $20bn extension to the airline industry, which at midnight laid off and furloughed approximately 32,000 workers.

Shares of American Airlines, Delta, United Airlines and JetBlue were all higher in late morning trading in New York.

In economic news on Thursday, consumer spending – the engine of the US economy driving some two-thirds of growth – increased a better-than-expected 1 percent in August, the US Commerce Department reported.

A person holds a sign advertising a sale at Century 21, a retail outlet that announced it was filing for bankruptcy and closing its stores due to the economic impact of the coronavirus in Manhattan, New York, US [File: Andrew Kelly/Reuters]A separate report by the US Department of Labor showed the number of Americans filing new claims for jobless benefits fell to 837,000 last week. But that is still persistently high, signalling that the jobs market recovery may be cooling as federal aid runs dry.

Among the stocks making news on Thursday, shares of Boeing were up 2.78 percent in late morning trading on Wall Street after Federal Aviation Administration chief Steve Dickson took the updated 737 MAX for a test flight On Wednesday and said “I like what I see” – a milestone for the jet returning to the skies after two fatal crashes and a long grounding.

Shares of PepsiCo were up 0.8 percent after the company reported that its net sales grew by 5.3 percent in its latest quarter as consumers bought more munchies like Doritos and Cheetos. It was leading in premarket trading but levelled off down just half a percentage point at the opening.

Shares of Bed Bath & Beyond were up a significant 33.7 percent after reporting a surprise bump in quarterly earnings.