US stocks drop from record highs as investors brace for key speech from Fed chief Powell
Andrew Kelly/Reuters
- US stocks dropped Thursday as markets grew cautious ahead of the Jackson Hole meeting tomorrow.
- Investors are waiting for clues on the path of economic policy from Jerome Powell's speech.
- Weekly jobless claims came in higher than economists expected.
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US stocks dropped Thursday after hitting record highs the previous day as investors counted down to Jerome Powell's speech at the Jackson Hole Symposium.
Investors are laser focused on the Fed chair's speech at the virtual symposium of central bankers on Friday. Powell's words will be scrutinized for any clues about the Fed's outlook on tapering its asset purchases.
The S&P 500 slipped over 0.5% after hitting its 51st record high for 2021 Wednesday. The benchmark index is currently on pace for 78 new highs in 2021, which would be an all-time record in a single year, according to LPL Financial Chief Market Strategist Ryan Detrick.
Here's where US indexes stood at the 4:00 p.m. ET close on Thursday:
- S&P 500: 4,469.99, down 0.58%
- Dow Jones industrial average: 35,213.71, down 0.54% (191.79 points)
- Nasdaq composite: 14,945.81, down 0.64%
Craig Johnson, Piper Sandler chief market technician, said the continued climb of new coronavirus cases in the US has sparked speculation the Fed's tapering timeline could be extended. Paolo Zanghieri, senior economist of Generali Investments said that Powell's speech will be short on tapering details amid persistent risk from rising COVID-19 cases.
On the economic data front, weekly jobless claims reached an unadjusted 353,000 last week, the Labor Department announced Thursday morning. That compares to a median estimate of 350,000 claims from economists surveyed by Bloomberg. It was the first increase in claims in 5 weeks.
An investment adviser is planning to launch an exchange-traded fund under the ticker "MEME" that screens stocks based on their social media activity and levels of short interest. Meanwhile, short-squeezes are hitting SPAC stocks as investors redeem their shares ahead of mergers.
West Texas Intermediate crude fell 1.08% to $67.62 per barrel. Brent crude, oil's international benchmark, slid 1.30%, to $71.31 per barrel.
Gold gained 0.16% to $1,793 per ounce.
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