MANHATTAN (CN) — Another week, another round of historically high unemployment, and another week of Wall Street shrugging its shoulders.
The Department of Labor’s report Thursday morning showed 6.6 million additional unemployment claims were filed for the week ending April 3, adding to the 10 million new claims already filed the two weeks prior.
But investors expecting another round of bad jobs numbers did not flinch at the news, with Dow Jones Industrial Average gaining more than 350 points in early trading.
In each of the last three weeks actual unemployment was higher than most economists’ predictions, but the numbers have had little negative effect on markets.
Investors seemed focused less on the fact that 16 million Americans are newly unemployed and instead keenly watched the Federal Reserve.
In an announcement just before the jobs report was released, the Fed said it would provide an additional $2.3 trillion in loans to prop up the economy, with most of the new funds targeted toward small businesses and state and local governments.
“Our country’s highest priority must be to address this public health crisis,” Federal Reserve Board Chair Jerome Powell said in a statement. “The Fed’s role is to provide as much relief and stability as we can during this period of constrained economic activity.”
The loans to businesses would range from $1 million to $25 million, though the Fed noted such loans could be higher depending on the company’s 2019 earnings before interest, taxes, depreciation and amortization.
The Fed — which already has slashed interest rates nearly to zero and opened an unlimited funding mechanism for beleaguered businesses — was rattled last month by the spread of coronavirus.
During the March 15 meeting of the central bank’s open markets committee, the Fed considered a doomsday scenario of no economic recovery until next year.
“In one scenario, economic activity started to rebound in the second half of this year,” according to the meeting’s minutes, released late Wednesday. “In a more adverse scenario, the economy entered recession this year, with a recovery much slower to take hold and not materially under way until next year.”
The Fed committee said during the meeting that it would keep interest rates near zero until the economy met the central bank’s “maximum employment and price stability goals.”
Markets, already having a fairly good week, jumped Wednesday after Senator Bernie Sanders announced his withdrawal from the Democratic primary. The Dow gained 400 points, and the S&P 500 and Nasdaq climbing about 2% each soon after the news broke. The Dow closed at 23,426 points, up almost 30% from its low point last month.
Nearly 1.5 million people have been confirmed to have Covid-19, and about 89,000 have died worldwide, according to data compiled by Johns Hopkins University. More than 432,000 have been infected by the virus in the United States, while almost 15,000 have died.