Stocks looked during afternoon trading like they would give up their early session gains following reports that House Speaker Nancy Pelosi sounded downbeat about the chances for another stimulus agreement to be reached, but the major averages bounced back off their lows to start the new quarter with gains.
ECONOMIC EVENTS: In the U.S., initial jobless claims fell 36,000 to 837,000 in the week ended September 26 after rising 7,000 to 873,000 in the September 19 week. U.S. Challenger reported announced job cuts rose 3,000 to 118,800 in September after dropping 146,900 to 115,800 in August. Personal income fell 2.7% in August, with spending rising 1%. Meanwhile, the Markit PMI manufacturing index was revised to 53.1 in the final September print from the 53.5 flash. In addition, the U.S. ISM manufacturing index dropped 0.6 points to 55.4 in September after rising 1.8 points to 56.0 in august.
Meanwhile, Politico reported that House Speaker Nancy Pelosi was "highly pessimistic" and "cast serious doubt" on the odds of reaching a deal with the White House on a new round of COVID-19 relief. The news came as Reuters reported that Senate Minority Leader Chuck Schumer said he spoke with Pelosi, who told him that she and the Trump administration remain at an impasse on an agreement.
TOP NEWS: As the COVID-19 pandemic continues and as Democratic leaders and the White House fail to reach a deal on a new stimulus package, multiple big companies have announced or are reportedly engaged in major job cuts. Bloomberg reported that Goldman Sachs (GS) intends to cut roughly 400 jobs and that JPMorgan (JPM) will also lay off over 100 employees as part of its annual cuts. Meanwhile, Allstate (ALL) announced that it is seeking to cut roughly 3,800 staff in an effort to reduce costs. Additionally, the Wall Street Journal reported that American Airlines (AAL) and United Airlines (UAL) have told employees that they will proceed for now with a total of over 32,000 layoffs.
The Federal Reserve has also responded to the continued economic uncertainty amid the coronavirus crisis, announcing after the close yesterday that it will extend for an additional quarter several measures to ensure that large banks maintain a high level of capital resilience. For the fourth quarter of this year, large banks-those with more than $100B in total assets-will be prohibited from making share repurchases. Additionally, dividend payments will be capped and tied to a formula based on recent income. Publicly traded companies in the space include Bank of America (BAC), Citi (C), Goldman Sachs, JPMorgan, Morgan Stanley (MS), U.S. Bancorp (USB) and Wells Fargo (WFC).
In other COVID-related news, the National Football League said it has postponed a scheduled Week 4 game between the Pittsburgh Steelers and the Tennessee Titans after one additional Titans player and one personnel member tested positive for the virus. ESPN's Adam Schefter reported that the game will be rescheduled for later in the season. Publicly traded companies in the gambling space include Boyd Gaming (BYD), Caesars (CZR), Churchill Downs (CHDN), DraftKings (DKNG), Flutter Entertainment (PDYPY), Gan Limited (GAN), Las Vegas Sands (LVS), MGM Resorts (MGM), Penn National (PENN), William Hill (WIMHY) and Wynn Resorts (WYNN).
On the earnings front, Bed Bath & Beyond (BBBY) shares surged 25.1% after the company reported upbeat Q2 results, with comparable sales rising 6% year-over-year. The retailer noted that it is not providing fiscal 2020 guidance due to COVID-19 uncertainty. In other earnings news, PepsiCo (PEP) shares were fractionally higher after the company reported better-than-expected Q3 results, with the beverage and snack giant noting that it does not expect pandemic-related costs to go away by next year.
Meanwhile, General Motors (GM) shares rose 2.7% after the company reported quarterly car sales numbers, saying it delivered 665,192 vehicles in Q3, down 10% year-over-year. In other GM news, the Wall Street Journal reported that Goldman Sachs will acquire the car maker's credit card business for about $2.5B after having won a bidding war against Barclays. Goldman and Capital One Financial (COF), which has issued GM's card since 2012, have agreed on the price and outline of a deal, the report said.
MAJOR MOVERS: Among the noteworthy gainers was Amag Pharmaceuticals (AMAG), which jumped 45.2% after it agreed to be acquired by Covis for $13.75 per share in cash. Also higher was Crocs (CROX), which gained 5.8% after singer Justin Bieber hinted at a collaboration with the footwear company coming "soon."
Among the notable losers was Par Technology (PAR), which fell over 9% after its 3.35M share secondary offering priced at $38.00. Also lower was Celsius Holdings (CELH), which declined 3.4% after "The Bear Cave" posted a short report questioning the company's disclosures and internal controls.
INDEXES: The Dow rose 35.20, or 0.13%, to 27,816.90, the Nasdaq gained 159.00, or 1.42%, to 11,326.51, and the S&P 500 advanced 17.80, or 0.53%, to 3,380.80.
JPMorgan
+0.77 (+0.80%)
Goldman Sachs
-2.61 (-1.30%)
Allstate
-1.95 (-2.07%)
American Airlines
+0.29 (+2.36%)
United Airlines
+0.44 (+1.27%)
Bank of America
+0.04 (+0.17%)
Citi
+0.39 (+0.91%)
Morgan Stanley
-1.08 (-2.23%)
U.S. Bancorp
+0.18 (+0.50%)
Wells Fargo
+0.07 (+0.30%)
Boyd Gaming
+0.72 (+2.34%)
Caesars
+1.02 (+1.82%)
Churchill Downs
+6 (+3.65%)
DraftKings
+2.95 (+5.01%)
Use FLUT
+ (+0.00%)
Gan Limited
-0.87 (-5.15%)
Las Vegas Sands
-0.42 (-0.90%)
MGM Resorts
+0.09 (+0.41%)
Penn Entertainment
+1.35 (+1.86%)
William Hill
+ (+0.00%)
Wynn Resorts
+0.1 (+0.14%)
Bed Bath & Beyond
+3.75 (+25.02%)
PepsiCo
+2.57 (+1.86%)
General Motors
+0.81 (+2.74%)
Barclays
-0.01 (-0.20%)
Amag Pharmaceuticals
+4.25 (+45.12%)
Crocs
+2.43 (+5.69%)
Par Technology
-3.54 (-8.76%)
Celsius Holdings
-0.82 (-3.60%)