First, the bad news: the Department of Labor released its data for first-time jobless claims for the week ended March 21. The numbers were as bad as predicted, with 3,283,000 filing initial claims, up 3,001,000 from the previous week, as the effect of COVID-19 on business became painfully obvious. According to the Department, this was the highest level of seasonally adjusted initial claims since 695,000 in October of 1982.
But the dismal unemployment stats has so far not affected the stock market, which has been extremely volatile recently. At the end of Wednesday, both the S&P (Standard and Poors) and Dow Jones indexes posted gains for the second day in a row—the first time in about a month.
Thursday morning, the Dow Jones industrial average was up over 300 points at the opening bell, and markets continued to rise through mid-morning trading.
By the time of market close on Thursday, the Dow rose 6.3%, up 1,352 points, marking its biggest three day surge since 1931. The Nasdaq finished Thursday up 5.6%, while the Philadelphia Semiconductor Sector Index of 30 semi companies jumped 6.8%.
Investors are undoubtedly continuing to bask in the glory of the Senate approving the massive coronavirus relief package, now pegged at $2.2 trillion, that would help bail out many businesses forced to shutter or scale down operations and give many Americans checks to alleviate their strained finances. The impending relief package, which still requires House approval, has buoyed investors’ confidence in the economy for the long run.
Still, the eventual relief the bill would provide does not obscure the dramatic rise in unemployment that is expected to continue and likely accelerate as struggling businesses shed more workers.
According to reports, some industry observers actually expected unemployment numbers to be higher. But the sheer volume of people filing initial unemployment claims also caused many computer systems handling the claims to quickly become overloaded and inaccessible for periods of time, likely delaying filing for many.