• The Star Staff

Wall Street hits one-month high as Trump fuels stimulus hopes

Wall Street’s main indexes rose to a one-month high on Thursday as comments by U.S. President Donald Trump raised hopes of fresh fiscal aid, while data showed a recovery in the labor market struggled to gain momentum.


Two days after calling off talks on a comprehensive bill, Trump said some discussions were ongoing with Democrats about boosting support for U.S. airlines and providing Americans with $1,200 stimulus checks.


House of Representatives Speaker Nancy Pelosi said legislation to help airlines was a matter of national security and could only move through Congress with guarantees of work continuing on the comprehensive deal.


The Dow Jones airlines index .DJUSAR was up about half a percent after earlier rising as much as 2.9% to a three-week high.


“A compromise on a big stimulus package in Washington could potentially deliver another October surprise,” said Jeff Buchbinder, equity strategist at LPL Financial in the Greater Boston Area.


“The optics of getting nothing done aren’t great on either side, and there are a lot of close Senate races right now, suggesting there still may be a glimmer of hope for a deal by Nov. 3.”

All the 11 major S&P indexes were up by early afternoon, with the energy sector .SPNY tracking a jump in oil prices.


Still, gains were largely led by the real estate .SPLRCR and utilities .SPLRCU sectors - both considered defensive plays. U.S. Treasury prices also edged higher, suggesting a cautious mood across financial markets.


Data on Thursday showed the number of Americans filing new claims for jobless benefits drifted lower last week but signaled the labor market was making little headway in getting millions of people back on the job after being out of work due to COVID-19 disruptions.


Doubts about more fiscal aid and signs of a slowing domestic economic rebound halted a five-month gaining streak on Wall Street in September, but the main indexes have since recovered, partly as investors begin to digest the prospect of Democratic presidential nominee Joe Biden winning the Nov. 3 election.


Biden appeared to lead Trump among likely voters in Florida and the two were locked in a tight race in Arizona, according to Reuters/Ipsos opinion polls released on Wednesday.


At 1:18 p.m. ET, the Dow Jones Industrial Average .DJI was up 0.23%, the S&P 500 .SPX was up 0.59% and the Nasdaq Composite .IXIC was up 0.39%.


International Business Machines Corp IBM.N rose 5.1% after saying it was splitting itself into two public companies, capping its years-long effort to diversify away from its legacy businesses to focus on high-margin cloud computing.

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