U.S. jobless numbers may take a backseat as investors take cues from virus spread

Investors are likely to look past what promises to be one of the worst U.S. jobless claims reports in history as they maintain a focus on the coronavirus’ spread and details of the government’s stimulus measures. Most investors have already accepted that Thursday’s jobless claims will reflect a spreading slowdown in economic activity, as efforts to contain the coronavirus pandemic hit large sections of the U.S. economy.

At the same time, some believe Thursday’s data may not accurately show the scope of layoffs across the United States, as companies make hard decisions about layoffs and states grapple with the sudden surge in claims. Forecasts in a Reuters poll range from a minimum of 250,000 initial claims, all the way up to 4 million. The poll shows a median forecast of 1 million claims, which would top highs logged during recessions in 1982 and 2009.

Global investors have already looked past one round of dismal economic data on Tuesday, when markets surged even as surveys on business activity showed record drops in many countries, including the United States. Still, a much worse than expected unemployment number may be too much to ignore and could crush hopes that unprecedented stimulus from the Federal Reserve and a $2 trillion government stimulus package may have put a floor on the market’s declines, some said.

U.S. jobless numbers may take a backseat as investors take cues from virus spread, Reuters, Mar 25