U.S. stocks traded near the flatline on Thursday as investors weighed a mixed set of economic indicators ahead of the highly anticipated monthly jobs report due later in the week.
By 10:30 ET (15:30 GMT), the Dow Jones Industrial Average was up 140 points, or 0.3%, while the S&P 500 slipped 0.1%. The Nasdaq Composite underperformed, falling 0.5%, reflecting weakness in growth-oriented shares.
Fresh labor data showed that new filings for unemployment benefits rose modestly last week, signaling that layoffs remained relatively contained toward the end of 2025, even as hiring demand stayed soft. Initial claims for state unemployment benefits increased by 8,000 to a seasonally adjusted 208,000 in the week ended December 27.
At the same time, productivity data painted a more encouraging picture. The Bureau of Labor Statistics reported that U.S. worker productivity rose at a 4.9% annualized pace in the third quarter, the fastest growth in two years. That followed an upwardly revised 4.1% increase in the previous quarter and marked the strongest showing since the third quarter of 2023.
Market focus is now firmly on Friday’s nonfarm payrolls report, which is expected to provide clearer insight into employment trends and wage pressures. The data will play a crucial role in shaping expectations around the timing and scale of potential interest rate cuts by the Federal Reserve.
Stephen Miran, a Federal Reserve governor whose term expires at the end of January, said he is looking for roughly 150 basis points of rate cuts this year to support the labor market. Miran noted that underlying inflation is running close to the Fed’s target, suggesting room for policy easing over the medium term.
Additional signals of cooling labor conditions came from payroll processor ADP, which reported on Wednesday that private-sector job growth slowed more than expected in December. While ADP data can be volatile, it reinforced the view that hiring momentum is gradually easing.
U.S.-Venezuela tensions linger
Geopolitical risks remained elevated following the U.S. capture of Venezuelan President Nicolas Maduro, though markets have so far shown limited reaction to the dramatic development. Investors have largely looked past the tensions, even as they add uncertainty to the outlook for energy markets.
Oil prices moved higher on Thursday but pared some gains after a report from The Wall Street Journal said the U.S. was planning to exert long-term control over Venezuelan oil. Crude prices found support after two sessions of sharp declines, helped by data showing a larger-than-expected draw in U.S. oil inventories and continued hostilities between Russia and Ukraine.
Brent crude rose 1.6% to $60.95 a barrel, while U.S. West Texas Intermediate advanced 1.5% to $56.83 a barrel. Both benchmarks had fallen more than 1% in each of the prior two sessions.
Earlier this week, President Donald Trump said Venezuela would transfer between 30 million and 50 million barrels of oil to Washington, a move valued at up to $3 billion.
Defense and housing stocks in focus
In corporate news, housing and defense-related stocks drew attention after a series of policy proposals from Trump. These included plans to curb institutional purchases of single-family homes to ease housing shortages, as well as proposals to restrict defense contractors from issuing dividends or conducting share buybacks.
Trump also called for U.S. defense spending to increase by more than 50% to $1.5 trillion by 2027, though it remains unclear whether such measures could be enacted without congressional approval.
Investors are also awaiting rulings from the Supreme Court of the United States on the legality of tariffs imposed by Trump, with decisions expected on Friday.
