Wall Street is deep in the red on Thursday. Investors are wrapping their heads around the morning's economic data including the GDP report, which finally put a number on just how badly the economy fared during the spring lockdown, as well as an increase in weekly jobless claims.
The Dow shed nearly some 470 points, or 1.8%, around mid-morning, with only one stock in the index trading in positive territory. The S&P 500, meanwhile, fell 1.4%. The tech-heavy Nasdaq Composite was down 0.9%. The biggest stock declines were in energy and basic materials sectors.
Adding to the morning's air of uncertainty, before the opening bell President Donald Trump tweeted floating the idea of delaying November's presidential election. Though he has no authority to do so -- it's Congress that has the power to set voting dates -- the message provides an opening that he and his supporters might refuse to accept the results.
US gross domestic product -- the broadest measure of the economy -- plummeted at an annual rate of 32.9% between April and June, the worst drop on record. While the decline wasn't as bad as economists had predicted, it hammered home just how much the economy suffered at the height of the pandemic lockdown.
The economy is expected to rebound in the current, third quarter of the year. But increasing Covid-19 infections across the country that could hold back the pace of the recovery.
Meanwhile, the Labor Department reported a second-straight uptick in first-time applications for unemployment benefits Thursday morning. This is worrying because it could signify a slowdown in the labor market recovery.
The bottom line is that the US economy runs on consumer spending, but people spend less money when they are unemployed.