Wall Street Stocks Stumble, S&P500, Nasdaq Snap Record Runs

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Key Takeaways

• Equities in the US end Thursday lower as investors take some risk off the table
• Fed Chairman Jerome Powell expected to offer key insights in his speech today

Wall Street Stocks Stumble, S&P500, Nasdaq Snap Record Runs

US stocks declined broadly on Thursday as major averages ended a series of gains and retreated from all-time highs set the previous day. The three main US indexes wobbled during the session as investors decided to offload risk as they anticipated updates from the three-day virtual meeting between central bankers who confer at the Jackson Hole symposium.

The S&P500 slipped into negative territory for the day with all but one sector finishing lower. The blue-chip index fell 26.19 points, or 0.58%, to 4,470.00. The S&P500 snapped a five-day winning streak that had ended with a closing record a day earlier.

The Nasdaq Composite also broke its five-day stretch of gains and ended the day with a loss of 96.05 points, or 0.64%, to 14,945.81. The Dow Jones Industrial Average slipped 192.38 points, or 0.54%, to settle at 35,213.12.

Anticipated Fed Chairman Speech Scheduled for Today

The increased market jitters that have prompted investors to stay more on the defense side were largely attributed to the upcoming address of Federal Reserve Chairman Jerome Powell at this year’s annual Jackson Hole conference.

Slated to speak today at 10 am Eastern Time, the Fed chairman is expected to offer cues on the central bank’s tapering timeline. Since the start of the pandemic in March last year, the Federal Reserve has been buying bonds at a pace of $120bn per month to jumpstart and sustain economic growth.

Mr. Powell could also choose to speak about when and by how much the Fed intends to increase the interest rates as indicated in the latest meeting minutes from the Federal Reserve Policy Committee.

Fresh data from the Commerce Department on Thursday showed that the US economy expanded 6.6% in the second quarter from a year ago. The figures were revised upwardly from the initial 6.5% growth rate reported last month.

Adding to the signs of a healing economy and improving labor market, the Labor Department said weekly jobless claims arrived at 353,000 nearly hitting estimates for 350,000.

The numbers of workers filing for unemployment benefits marked a slight increase by 4,000 on a weekly basis. The four-week moving average, in the meantime, continued to decrease as it fell to 366,500 last week, the lowest since the pandemic began.

The sustained decline was consistent with the rate of labor market growth. In July, employers added 943,000 new jobs, the strongest monthly gain in 11 months.

US Futures, European Stocks, and Cryptocurrency in the Green

Meanwhile, on Friday, US stock index futures turned green a few hours before the opening of the regular market session. Dow futures, S&P500 futures, and Nasdaq futures were positive by 0.3% or more.

European equities trade slightly to the upside in the early hours of stock trading in the old continent. The Stoxx Europe 600 benchmark is moderately higher as investors attempt to pare yesterday’s losses. Thursday’s market performance was largely disappointing as major European bourses were all lower for the day.

Cryptocurrencies, which also ended Thursday in the red, are staging a modest rebound on Friday. Bitcoin was able to climb back above $47,000 after slipping to a session low of $46,300 earlier in the day. Ether is also slightly in the green, up less than 1%.