Stock Market Today: Dow futures steady ahead of jobless claims report

Wall Street’s losses were accelerating Thursday heading into the afternoon as traders reacted to the latest batch of economic data and commentary from top Federal Reserve officials.

S&P Global flash PMI surveys for August hinted at more labor-market weakness as hiring stalled for both service and manufacturing businesses in the U.S. S&P Global said recent months have seen the worst stretch of weakness on the hiring front since the first half of 2020.

That wasn’t the only piece of suboptimal data. The latest reading on weekly jobless claims showed the number of Americans applying for benefits was slightly higher than economists had expected.

And while sales of existing homes rose for the first time in five months in July, one economist noted that the pace remained sluggish compared with what has traditionally been one of the strongest selling seasons of the year.

Traders also digested a raft of Fedspeak, including comments from Kansas City Fed President Jeffrey Schmid, who told CNBC earlier that he was still concerned about getting inflation back to the Fed’s 2% target. Philadelphia Fed President Patrick Harker said later that he was undecided about whether to cut rates by 25 basis points or 50 basis points next month.

As investors try to parse what might be next for the economy and markets, all eyes are on Fed Chair Jerome Powell, who is due to speak in Jackson Hole on Friday. His comments are considered the highlight of the Kansas City Fed’s annual symposium.

All in all, markets are still holding up after a rapid recovery from a selloff earlier this month. If the S&P 500 finishes lower on Thursday, it would mark just the second red day for the index in the past 11 sessions, FactSet data showed. The index remained within striking distance of a fresh record high.

Here is where stocks were recently:

Williams-Sonoma Inc.’s stock tumbled 9% Thursday after the upscale home-goods retailer’s fiscal second-quarter sales lagged consensus and it trimmed revenue guidance for the year.

On a call with analysts, Chief Executive Laura Alber said it’s clear the home-furnishings market is challenged by the uncertainty in the economy and a slow housing market. Her remarks echoed comments from Home Depot Inc. last week and Lowes Co. Inc. this week that their customers are delaying renovation plans.

“This leads us to believe that we may not see the back-half acceleration that we expected, despite all of the hard work we’ve done to improve our product offer and our customer experience,” Alber said, according to a FactSet transcript.

U.S. stocks turned lower on Thursday after a pair of PMI surveys from S&P Global hinted at more labor-market weakness.

Here is where they were trading recently:

On the surface, the numbers looked good. The first reading of the S&P U.S. services index of purchasing managers edged up to 55.2 in August, from 55.0 in the prior month. Although the preliminary reading on U.S. manufacturing PMI fell to an eight-month low of 48.

Investors, however, appeared more focused on details of the report that reflected more evidence of labor-market weakness, according to one strategist.

Net job losses from a composite reading on employment have now been reported during three of the past five months, the softest period of job growth since the first half of 2020, S&P Global said.

“If I had to venture a guess, I would say the weak employment data in the PMI reports has investors on edge after yesterday’s downward revision to the BLS payrolls data and the broader concerns about a labor market downturn,” said Ross Mayfield, an investment strategist at Baird.

Still, the magnitude of stocks’ declines remained relatively modest, with the S&P 500 remaining within striking distance of its record close on July 16.

Bret Kenwell, U.S. investment analyst at eToro, chalked up Thursday’s weakness to run-of-the-mill jitters as investors waited to hear from Fed Chair Jerome Powell.

“All eyes are now shifting to Jackson Hole to see if Powell will lay out the road map for interest rate cuts next month,” Kenwell said.

U.S. growth stocks were rising Thursday, as value equities struggled to climb into positive territory in morning trade.

The Russell 1000 Growth Index was up 0.1% on Thursday morning, while the Russell 1000 Value Index was down 0.1%, according to FactSet data, at last check.

Gains from growth stocks far exceed the rise in value equities so far this year, with the Russell 1000 Growth index up 21.9% year to date on Thursday morning and the Russell 1000 Value index trailing with a 10.7% increase over the same period.

The U.S. stock market was broadly slipping Thursday morning as investors awaited Federal Reserve Chair Jerome Powell’s Jackson Hole speech on Friday. The Dow Jones Industrial Average was falling 0.1%, while the S&P 500 dipped less than 0.1% and the technology-heavy Nasdaq Composite shed 0.1%, FactSet data show, at last check.

Treasurys continued to selloff Thursday morning, sending the policy-sensitive 2-year rate to an intraday high of 4.01%, after S&P Global data showed U.S. business activity growth remained robust this month.

The 2-year rate rose about 8 basis points to just under 4% after briefly piercing that level soon after S&P Global’s data was released.

U.S. stocks opened higher on Thursday but quickly pared their initial advance as traders digested the latest job-market data while looking ahead to a speech from Federal Reserve Chair Jerome Powell.

Central bankers from around the world arrived in Jackson Hole, Wyo., on Thursday for the start of the Kansas City Fed’s annual symposium. On Wall Street, Powell’s comments are widely seen as the main event. He is due to speak at 10 a.m. Eastern time on Friday.

Here’s how stocks were trading:

Broadcom’s stock is up about 2% in Thursday morning action and among the leading S&P 500 gainers, as J.P. Morgan cheered the semiconductor company’s opportunity.

J.P. Morgan analyst Harlan Sur thinks Broadcom recently landed business from OpenAI, which would be the company’s fourth major customer for its artificial-intelligence application-specific integrated circuit. He also believes the company now has a fifth big customer in that arena.

“The company should be a strong beneficiary of the trends towards more custom chip designs as large cloud titans/[original equipment manufacturers] look to drive more performance, power, and cost differentiation alongside their software frameworks,” Sur wrote, while reiterating his overweight rating and $200 target price on the stock.

Broadcom’s stock is the top gainer in the PHLX Semiconductor Index early in Thursday’s trading day.

Jobless claims on Thursday bolstered the case for the Federal Reserve to cut rates in September by 25 basis points, said Larry Adam, chief investment officer at Raymond James.

“The labor market continues to slow. It’s softening, but not collapsing,” Adam said in an interview with MarketWatch.

He thinks a bigger cut of 50 basis points at the Fed’s mid-September policy meeting could spook markets.

Adam also will be listening closely to Fed Chair Jerome Powell’s Jackson Hole speech on Friday for any attempts to walk back some of the more aggressive market expectations for rate cuts this year.

Odds on Thursday favored 100 basis points of rate cuts through December, which would bring the fed-funds rate to a 4.25%-4.5% range, according to the CME FedWatch Tool.

Treasury yields were little-changed on Thursday after the latest jobless-claims report reflected a slight increase in demand for benefits.

Yields whipsawed initially as bond traders appeared not to know what to make of the data immediately after its release. But they have since settled around their levels from earlier.

The yield on the 10-year Treasury note was up 4 basis points at 3.832%, according to FactSet data. The yield on the 2-year Treasury note, meanwhile, rose 4 basis points at 3.973%. The yield on the 30-year Treasury bond rose by 4 basis points to 4.104%.

A closely tracked index of the U.S. dollar’s strength against a basket of rivals was bouncing back on Thursday after hitting its weakest level of 2024 a day earlier.

The ICE U.S. Dollar Index was up 0.3% at 101.31 early Thursday following a sharp decline in August, according to FactSet data. The drop had left the greenback in what Jeff deGraaf of Renaissance Macro described as “oversold” territory.

Minutes from the latest Federal Reserve meeting released Wednesday, along with a preliminary revision to the Labor Department’s job numbers, prompted investors to dial up bets on aggressive Federal Reserve rate cuts, heaping more pressure on the buck.

As of early Thursday, the dollar has declined 2.7% since the start of August and was hovering around unchanged on the year in recent trade.