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Congress holds GameStop hearing, jobless claims rise: How the news could affect your money

The hearings could influence online trade practices or lead to stricter trading regulations.  

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People walk by a GameStop store in Brooklyn on January 28, 2021 in New York City.
Spencer Platt | Getty Images News | Getty Images

Markets are mixed even as the Dow hits a new record high, Congress will hold a hearing on GameStop's short-selling frenzy, and more people file first-time unemployment claims. Here's how the headlines could affect your money.

Markets end Wednesday mixed

The Dow closed 0.3% higher Wednesday to hit a new record high. The S&P 500 fell less than 0.1%, while the Nasdaq fell 0.6%.

All three of the major indexes were down Thursday morning.

Jobless claims worse than expected

The number of Americans who filed for unemployment benefits for the first time reached its highest level in a month, according to the Department of Labor. Jobless claims totaled 861,000 for the week ending February 13, slightly higher than the prior week and worse than economists expected.

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Congress to hold hearing on GameStop saga

The House Committee on Financial Services will dig into the recent GameStop saga Thursday. 

During the hearing, lawmakers are set to hear testimony from major players, including the heads of Reddit, Robinhood, Citadel, and Melvin Capital. 

Lawmakers raised red flags last month when online users short-squeezed GameStop and other retailer's stocks, forcing shares of the video game retailer to skyrocket to $483 before shedding 90% of their value.

"We think the congressional hearing will focus on understanding exactly what occurred during the week of service disruptions, making sure that all activity was appropriate and also determining how to avoid a similar event in the future," JMP Securities analyst Devin Ryan told CNBC.

Experts say the hearings could influence online trade practices or lead to stricter trading regulations for investors.  

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Words you've heard: Payment for order flow

PFOF, or payment for order flow, is the compensation that a brokerage firm receives for directing orders on its platform to a third party to execute a trade. Lawmakers are likely to ask about this practice during the GameStop hearings, assessing its effect on retail traders and its role in the stock surge.

Although the daily news can have an impact on your wallet, remember to take a long-term outlook when it comes to decisions on spending, saving, and investing.

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