• About 2.44 million Americans filed for unemployment benefits last week
  • Over the past nine weeks, 38.6 million people have filed jobless claims
  • The Philadelphia Fed manufacturing index rose to minus-43.1 in May

U.S. stocks fell on Thursday as traders were deluged with more gloomy economic data while U.S.-China tensions escalate.

The Dow Jones Industrial Average fell 101.78 points to 24,474.12, while the S&P 500 tumbled 23.1 points to 2,948.51 and the Nasdaq Composite Index dropped 90.9 points to 9,284.88.

Thursday’s volume on the New York Stock Exchange totaled 4.07 billion shares with 1,577 issues advancing, 29 setting new highs, and 1,363 declining, with five setting new lows .

Active movers were led by General Electric Co. (GE), Ford Motor Co. (F) and Luckin Coffee Inc. (LK).

About 2.44 million Americans filed for unemployment benefits last week, the seventh consecutive week of decline. Over the past nine weeks, 38.6 million people have filed.

“Although the number of new jobless claims continues to ease … the sharp rise in continuing claims the week before illustrates that the easing of lockdowns in many states has not yet resulted in any large-scale recall to work for those currently on temporary layoff,” said Paul Ashworth, chief U.S. economist at Capital Economics. “There is little evidence that the reopening of the economy has, as yet, led to any sudden snap back in employment.”

The Philadelphia Fed manufacturing index rose to minus-43.1 in May, up from minus-56.6 in April, which was a 40-year low.

Sales of existing homes plunged by 17.8% month-to-month in April, and were 17.2% lower than in April 2019, said the National Association of Realtors.

“Certainly with the lock-down occurring from mid-March, and given the shakiness from the stock market in February, that hurt pending contracts, so now we are seeing an almost 20% decline in existing homes sales,” said Lawrence Yun, chief economist for the NAR. “April activity will be down, but what we are hearing from realtors is they are getting busy as governors are opening the economy.”

The Conference Board Leading Economic Index amounted to 98.8 in April, down 4.4% from March.

New York Federal Reserve Bank President John Williams said Thursday that the unemployment rate will get worse.

“What we don’t know is what the shape or timescale of the recovery will be,” he said. “It’s going to be some time before we have a clearer view of the effects on other industries, including autos, higher education, manufacturing, and professional services.”

Federal Reserve Vice Chairman Richard Clarida said the central bank may need to provide more support for the crippled economy.

“Depending on the course the virus takes and the depth and duration of the downturn it causes, additional support from both monetary and fiscal policies may be called for,” he said.

The number of confirmed global cases of coronavirus has now surpassed 5 million and almost 330,000 people have died from the virus.

Tensions with China are worsening. On Wednesday, the U.S. Senate passed a bill that could lead to the delisting of Chinese companies from U.S. stock exchanges.

President Donald Trump then criticized the Chinese leadership on Twitter.

“China is on a massive disinformation campaign because they are desperate to have Sleepy Joe Biden win the presidential race so they can continue to rip-off the United States, as they have done for decades, until I came along,” Trump tweeted.

Trump also directly blamed China for spreading Covid-19. “It all comes from the top. They could have easily stopped the plague, but they didn’t” he wrote.

“The economic data today ... still demonstrates the labor market continues to suffer in the near term,” said Michael Arone, chief investment strategist at State Street Global Advisors. “You combine that with rising U.S.-China tensions and what’s been a pretty good week, and that’s your recipe for this market languishing today.”

“Markets may be pricing in far too much complacency as the U.S.-China ‘phase one’ trade deal could be at risk,” said Stephen Innes, chief global market strategist at AxiCorp. “The pandemic and resulting acute economic downturn have made China’s trade commitment to the U.S. much more challenging to fulfill.”

Overnight in Asia, markets finished lower. The Shanghai Composite dropped 0.55%; Hong Kong’s Hang Seng fell 0.49%; while Japan’s Nikkei-225 slipped 0.21%.

In Europe markets finished in the red, as Britain’s FTSE-100 dropped 0.86%, while France’s CAC-40 sank 1.15% and Germany’s DAX fell 1.41%.

Crude oil futures gained 1.4% at $33.96 per barrel, Brent crude edged up 0.14% at $36.11. Gold futures dropped 1.58%.

The euro edged down 0.3% at $1.0946 while the pound sterling slipped 0.16% at $1.2218.

The yield on the 10-year Treasury slipped 0.44% to 0.677% while yield on the 30-year Treasury was flat at 1.399%.