By Geoffrey Smith
Investing.com -- U.S. stock markets opened higher on Thursday in anticipation of President-elect Joe Biden's stimulus plans, shrugging off fresh evidence of damage to the labor market from the pandemic.
By 9:35 AM ET (1435 GMT), the Dow Jones Industrial Average was up 108 points, or 0.4%, at 31,168 points. The S&P 500 was up 0.2% while the Nasdaq Composite was up 0.4%.
Biden is due later to present details of a stimulus plan that he has previously said will run to "trillions of dollars." The prospect of higher federal borrowing this year has raised questions as to whether the Federal Reserve's monetary stimulus will be enough to absorb all that extra issuance. Fed Chairman Jerome Powell may touch on the relationship between fiscal and monetary policy in a speech at 12:30 PM ET.
That the economy is in need of further support is not in question. Labor Department data released earlier showed that 965,000 Americans filed initial claims for jobless benefits, the highest weekly number since August and well above the 795,000 expected.
The numbers suggest that the U.S. economy will shed jobs for a second straight month in January, due largely to the devastating impact of lockdowns on the hospitality and travel sectors.
Among early movers, Tesla (NASDAQ:TSLA) stock fell 1.3% after regulators urged a recall for over 150,000 Model S and X cars whose touch screens showed signs of degradation with age. Alibaba (NYSE:BABA) and Tencent (HK:0700) ADRs rose 3.7% and 3.4% after reports that the U.S. administration will not add them to its blacklist of Chinese companies.
Quarterly reports are also starting to trickle in ahead of the dump of bank earnings on Friday that traditionally kicks off earnings season. Taiwan Semiconductor Manufacturing rose 7.3% after beating expectations for profit and guiding expectations for its first-quarter revenue higher. By contrast, Blackrock (NYSE:BLK) stock fell 2.8% despite the world's largest asset manager handily beating expectations for both earnings and revenue.
Delta Air Lines (NYSE:DAL) stock rose 3.7% after the airline predicted a strong second half to 2021, even though it still expects first-quarter revenue to be down by more than 60% from last year. The airline posted its first loss in over a decade in 2020.
Elsewhere, Virgin Galactic (NYSE:SPCE) stock rose 13% after star fund manager Cathie Wood said her company Ark Investment Management would launch an ETF devoted to space exploration.
Ark's ETF will primarily track U.S. and global companies engaged in space exploration and innovation, according to its filing with the Securities and Exchange Commission.
On the downside, Plug Power (NASDAQ:PLUG) stock was down 5.2%, the loss-making fuel cell manufacturer giving up some of its stellar gains over the last week that were made on the back of two strategic partnership with France's Renault (PA:RENA) and South Korea's SK Group.