EDITOR'S NOTE
Stocks edged higher Tuesday as investors continued to expect a congressional deal on a new coronavirus stimulus bill - and still, there was none.
Millions of unemployed Americans have been left high and dry as a $600 weekly expanded jobless benefit expired on Friday while Democrats and Republicans remained at odds. But as usual, investors hold out hope for a breakthrough.
“Congress will muster the fortitude to deliver near-term stimulus support,” Darrell Cronk, president of Wells Fargo Investment Management, wrote in a note. “However, a greater challenge comes in 2021 when this year’s extraordinary fiscal stimulus programs fade.”
The recovery is dependent on stimulus. CNBC's Jesse Pound takes a look at credit card spending data from JPMorgan, which appears to be a lot like the data from weekly jobless claims and hours worked by service sector employees. It all stalled in June as coronavirus cases resurged.
The JPMorgan findings show spending has been 10% or more below its 2019 levels for more than a month after rising from its lows in late March and early April, Pound writes.
"The coronavirus pandemic has caused great harm to the economy and the labor market," economists at the St. Louis Federal Reserve concluded in a blog post published Tuesday. "The recent evolution in our coincident employment index suggests that the recent recovery in employment has halted and that the increase in Covid-19 may be the main cause for this.”
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