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Money News

Wall Street rises on stimulus prospects as jobless claims remain high

(Reuters) - Wall Street’s main indexes rose on Thursday as U.S. President Donald Trump signaled progress in negotiations around new fiscal stimulus, while data showed jobless claims remained stubbornly high last week.

FILE PHOTO: The 11 Wall St. door of the New York Stock Exchange (NYSE) is seen in New York City, New York, U.S., June 26, 2020. REUTERS/Brendan McDermid

Two days after calling off talks on a comprehensive fiscal aid bill, Trump said some discussions were ongoing with Democrats about boosting support for U.S. airlines and providing Americans with $1,200 stimulus checks.

The Dow Jones airlines index jumped 1.3%, with Delta Air Lines Inc, United Airlines Holdings Inc, JetBlue Airways Corp and American Airlines Group Inc gaining more than 1% each.

“The market’s really dependent upon (fiscal) stimulus and trying to predict what that’ll likely be,” said Tim Chubb, chief investment officer at Girard in West Chester, Pennsylvania.

Suggesting a broader risk-on mood, all the 11 major S&P indexes were up, with the energy sector tracking a jump in oil prices. [O/R]

Doubts about more fiscal aid and signs of a slowing domestic economic rebound halted a five-month gaining streak on Wall Street in September, but U.S. stocks have since recovered, partly as investors begin to digest the prospect of Democratic presidential nominee Joe Biden winning the Nov. 3 election.

Biden appeared to lead Trump among likely voters in Florida and the two were locked in a tight race in Arizona, according to Reuters/Ipsos opinion polls released on Wednesday.

With less than a month left for the election, Trump said on Thursday he would not participate in a virtual presidential debate, moments after the commission that oversees the debates said the event on Oct. 15 would be conducted from remote locations in the wake of his COVID-19 diagnosis.

Meanwhile, data showed the number of Americans filing new claims for jobless benefits drifted lower last week but signaled the labor market was making little headway in getting millions of people back on the job after being out of work due to COVID-19 disruptions. [L1N2GY1AZ]

At 9:46 a.m. ET, the Dow Jones Industrial Average was up 0.40%, the S&P 500 was up 0.55% and the Nasdaq Composite was up 0.49%.

In company news, Coty Inc jumped 4.8% after the cosmetics maker announced the launch of direct-to-consumer websites for Kylie Skin brand in the UK, France, Germany and Australia.

Drugmakers Regeneron Pharmaceuticals Inc and Eli Lilly & Co gained 1.8% and 2.5% respectively, after Trump praised their COVID-19 medications and said he will make them free for Americans to use.

International Business Machines Corp rose 7.5% after saying it was splitting itself into two public companies, capping its years-long effort to diversify away from its legacy businesses to focus on high-margin cloud computing.

Eaton Vance Corp surged 46.3% and was on course for its best day ever after Morgan Stanley agreed to buy the asset management firm for about $7 billion in a cash-and-stock deal. Shares of Morgan Stanley fell 1.0%.

Advancing issues outnumbered decliners 4.56-to-1 on the NYSE and 2.84-to-1 on the Nasdaq.

The S&P index recorded 38 new 52-week highs and no new low, while the Nasdaq recorded 80 new highs and five new lows.

Reporting by Sagarika Jaisinghani and Devik Jain in Bengaluru; Editing by Maju Samuel

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