By US stocks inched lower on Thursday, fueled by an uptick in jobless claims ahead of a key jobs report and continued tensions in the Middle East.
Weekly jobless claims rose by 6,000 to 225,000, according to Labor Department data released Thursday.
That surpassed forecasts of around 221,000, but weekly claims remain low, with the four-week moving average falling to its lowest since June.
Investors are also focused on simmering geopolitical conflict in the Middle East, which triggered a sell-off Tuesday and early on Wednesday following a missile attack by Iran against Israel.
Oil prices have spiked this week as investors fear disruption to supply if Israel retaliates by striking Iran’s oil facilities.
On Friday, investors will be closely watching the September jobs report, which is expected to show the unemployment rate staying flat at 4.2%. Forecasters see an increase of 150,000 jobs in September, ahead of August’s figure of 142,000.
The data will be a key indicator for the Federal Reserve’s next rate cut decision after its jumbo 50-basis-point-rate cut last month. Markets are currently pricing in a 65% chance of a smaller, 25-basis-point cut in November, according to the CME FedWatch tool.
Analysts say the report will likely have a big influence on both markets and the Fed in the coming weeks.
“We think a soft employment report is likely to generate a larger market response vs a strong labor report,” Bank of America analysts said in a Wednesday report.
“We think the market is likely to focus most on labor data in the weeks ahead but must acknowledge inflation data could also support another 50bp cut in Nov,” they added.
Here’s where US indexes stood shortly after the 930 a.m. opening bell on Thursday:
- S&P 500: 5,694.76, down 0.26%
- Dow Jones Industrial Average: 42,048.11, down 0.35% (-148.41 points)
- Nasdaq composite: 17,877.91, down 0.29%
Here’s what else is going on today:
- Two sectors of the stock market are poised to benefit most if Trump wins in November, according to RBC.
- OpenAI will let employees sell some stock after its monster fundraising round.
- Stocks face a 10% drop with key economic data mired in recession territory, Verdence’s CIO says.
In commodities, bonds, and crypto:
- Oil futures rose. WTI crude rose 2.5% to $71.88 a barrel. Brent crude, the international benchmark, climbed 2.3% to $75.62 a barrel.
- Gold was nearly flat at $2,668 an ounce.
- The 10-year Treasury yield rose two basis points to 3.813%.
- Bitcoin inched lower to $60,438.
