Investing.com -- The S&P 500 closed lower Thursday, pressured by rising yields as investors opted for caution a day ahead of Federal Reserve chairman Jerome Powell's speech at Jackson Hole.
At 16:00 p.m. ET (2000 GMT), the Dow Jones Industrial Average fell 177 points, or 0.4%, S&P 500 fell 0.8%, and Nasdaq Composite fell 1.6%.
Powell set to speak at Jackson Hole
Losses in Wall Street were driven by rising Treasury yields as investors looked ahead to an address by Fed Chair Jerome Powell, at the Jackson Hole Symposium on Friday.
Markets widely expect Powell to reiterate the central bank’s dovish stance, setting the stage for a September rate cut, although it remained unclear whether the Fed Chair will explicitly telegraph a September cut.
"We expect him to say that a lot of progress has been made on inflation, and the FOMC is confident that continued progress is likely in the coming year," UBS said in a Wednesday note.
Ahead of Powell's speech, Kansas City Fed President Jeffrey Schmid said he needed to see more economic data before supporting any decision to begin reducing interest rates.
Jobless claims rise, manufacturing activity slips
Data released earlier Thursday showed that the number of Americans filing new applications for unemployment benefits rose 4,000 to a seasonally adjusted 232,000 in the latest week, adding to concerns of a cooling of the U.S. labor market.
This followed Wednesday's payrolls revision, as the U.S. economy created 818,000 fewer jobs than originally reported in the 12-month period through March 2024.
The actual growth was nearly 30% less than the initially reported, with the revision to the total payrolls level being the largest since 2009.
Adding to concerns about the economy, manufacturing activity slipped more than expected.
The minutes of the Fed’s late-July meeting, released on Wednesday, also showed an increasing number of policymakers supported lowering interest rates amid progress in bringing down inflation.
Analysts at Citi said they see a 50 bps reduction as their base case for September, especially after Wednesday’s minutes showed more officials leaning towards lower rates.
Peloton soars on turnaround momentum; Snowflake falls despite beat and raise
Peloton Interactive (NASDAQ:PTON) stock soared 34% after the connected fitness company returned to sales growth for the first time in nine quarters as its turnaround plan takes hold.
Snowflake (NYSE:SNOW) stock fell 14% after the enterprise software maker beat expectations for second-quarter earnings and revenue but offered tepid guidance that failed to assure investors in a competitive market.
"SNOW delivered solid results and an increase to guidance, though we believe investors were looking for stronger incremental Product Revenue after their strong first quarter," Truist Securities said in a note.
Williams-Sonoma Inc (NYSE:WSM) slipped nearly 9% after the company reported mixed quarterly results as earnings missed but revenue beat Wall Street estimates.
Advance Auto Parts (NYSE:AAP) stock fell more than 17% after the automotive parts retailer reported disappointing second quarter earnings and slashed its full-year outlook, dashing earlier gains on the back of private equity firm Carlyle Group (NASDAQ:CG) saying it would buy its Worldpac unit for $1.5 billion in cash.
Paramount, Evolent higher on M&A activity
Paramount Global Class B (NASDAQ:PARA) rose 1% after announcing it would extend its "go shop" period of its merger agreement with Skydance allowing the company to entertain rival bids. The company also confirmed that it had received a rival offer from Edgar Bronfman Jr.
Evolent Health Inc (NYSE:EVH) climbed 13% following a Reuters reported Thursday, citing unnamed sources, that the healthcare services provider, with a market value of $3.3 billion, in talks with private equity firms and other companies for a potential sale.
(Peter Nurse, Ambar Warrick contributed to this article.)