US Stocks Slide After Surging Jobless Claims

The stock market fell Thursday after unemployment claims surged at levels that are not enough to convince investors the Fed will change its aggressive rate policy. Oil giants Chevron (CVX) and Exxon Mobil (XOM) led gains while food and beverage companies declined on earnings.

The Nasdaq composite traded 0.1% lower, after initially climbing higher. The Dow Jones Industrial Average fell 0.3% and the S&P 500 lost 0.2%. The small-cap Russell 2000 index shed 0.3%. Volume rose on the Nasdaq and fell on the NYSE vs. the same time on Wednesday.

The Labor Department’s first-time unemployment claims rose to a five-week high of 219,000. Estimates called for a rise to 203,000 from 193,000 in the previous week.

The rise in unemployment claims was not high enough to convince investors the Fed might abandon its rate hike campaign. As of Thursday, 72.8% of investors expected the Fed to raise rates 0.75% at its Nov. 2 meeting, while 27.2% looked for a 0.50% hike.

The S&P Energy Select Sector ETF (XLE) rose 1.3%, making it the best-performing component of the 11 S&P sectors. Chevron gained 1.7% while Exxon was up 1.5%.

XOM is building a new base in a consolidation with a buy point of 105.67. Exxon stock surged Wednesday after it signaled natural gas prices would support already strong third-quarter expectations.