U.S. stocks declined on Thursday after weak labor market data raised fresh concerns about the health of the U.S. economy. The losses came just before the start of the Federal Reserve’s closely watched Jackson Hole symposium.
At 09:35 ET (13:35 GMT), the Dow Jones Industrial Average dropped 200 points, or 0.4%. The S&P 500 fell 24 points, also 0.4%, while the NASDAQ Composite slid 80 points, or 0.4%.
Jobless claims rise above expectations
The number of Americans filing for first-time unemployment benefits rose more than expected last week. This increase highlights further weakness in the U.S. labor market, already pressured by economic uncertainty linked to tariffs.
Seasonally adjusted jobless claims reached 235,000 for the week ending August 16, up from 224,000 the prior week. Economists had expected 226,000.
The release added to recent signs of a cooling labor market. Earlier data showed slower job creation in July, a higher unemployment rate, and a decline in labor force participation to its lowest level since late 2022.
Walmart results in focus
On the corporate front, Walmart (NYSE:WMT) reported mixed second-quarter results. Revenue topped expectations, but earnings fell short of analyst forecasts.
Despite the miss, Walmart raised its full-year sales and profit outlook, showing confidence in its growth. Its strong grocery business and low-price strategy continue to give it an edge in uncertain economic times.
The retail sector has been active this week. Home Depot (NYSE:HD) reported results on Tuesday, while Target (NYSE:TGT) slumped after naming insider Michael Fiddelke as CEO. Meanwhile, Coty (NYSE:COTY) fell after forecasting weak sales and profits for the first half of fiscal 2026.
Boeing (NYSE:BA) stock gained after reports that the company is close to a deal to sell up to 500 aircraft to China.
Tech stocks remain under pressure
The tech sector continues to face selling pressure, with doubts growing over the profitability of artificial intelligence. A report from the Massachusetts Institute of Technology claimed that 95% of firms were seeing “zero return” on AI investments.
This has raised questions about the AI-driven stock rally seen earlier this year. Investors are now awaiting Nvidia’s (NASDAQ:NVDA) upcoming earnings for fresh signals on the sector’s outlook.
Jackson Hole symposium in focus
Hawkish signals from the Federal Reserve’s July minutes added to market caution. Most Fed members supported keeping rates steady, citing inflation risks tied to President Donald Trump’s tariffs.
The Fed has signaled it may prioritize controlling inflation over short-term labor market weakness. Investors will closely watch Fed Chair Jerome Powell’s speech at Jackson Hole on Friday for clues on the next policy steps.
Oil prices stabilize
Oil markets steadied Thursday, giving back earlier gains. Brent futures rose 0.1% to $66.92 a barrel, while U.S. WTI crude traded flat at $62.72 a barrel.
Both benchmarks had climbed over 1% in the prior session after U.S. data showed strong demand. The Energy Information Administration reported a drop of 6 million barrels in crude inventories and a 2.7 million-barrel decline in gasoline stocks.
The data pointed to steady fuel demand during the peak summer travel season, helping offset global economic concerns.
