Wall Street showed subdued action as major gauges opened lower after investors reacted to jobs data showing U.S. jobless claims fell to 218,000.
Summary
- Dow Jones slid 120 points while Nasdaq fell 1.15% to lead losses across the major U.S. indexes.
- The S&P 500 also dropped 0.68% in early trading to see Wall Street risk a third straight day of negative closes.
- Stocks were wobbly after the U.S. jobless claims data showed initial filings for unemployment insurance dropped to 218,000.
After shedding gains in consecutive sessions, U.S. stocks looked shaky in early trading on Thursday.
The Dow Jones Industrial Average shed more than 120 points, while the S&P 500 and Nasdaq slipped 0.68% and 1.15%, respectively. Oracle and Nvidia retreated, and an uptick in yields catalyzed selling across tech stocks, pulling the tech-heavy Nasdaq Composite down.
This came after Wall Street saw the major indexes record negative closes on Tuesday and Wednesday, capping the recent spike that had stocks trading at all-time highs. Bitcoin (BTC) also struggled as prices fell to near $111,000.
Despite the back-to-back losses, investors maintained a bullish mood, with analysts noting the market may not conform to historical paradigms around fundamentals and elevated asset prices.
U.S. jobless claims fall
The shaky market materialized as investors reacted to the latest data on initial jobless claims for the week ending September 20.
According to a Labor Department report, first-time filings for unemployment insurance hit a seasonally adjusted 218,000, a decline of 14,000 from the prior week’s figure of 232,000 and below the consensus estimate of 235,000.
Beyond jobless claims, other reports on Thursday painted a solid economic outlook. U.S. real gross domestic product grew 3.8% in the second quarter, up from 3.3%. Meanwhile, core personal consumption expenditures increased 2.6%, slightly above the expected 2.5%. Home sales soared 20.5% in August, the biggest spike since January 2022.
Friday’s release of the Personal Consumption Expenditures index for August is now key to the market’s bet on the Federal Reserve’s move. PCE is the Fed’s preferred inflation gauge and analysts expect details signalling easing price pressures.
Overall, markets anticipate the Fed will lower interest rates again at its next two meetings scheduled for October and December.
