On Thursday, US stocks experienced a decline for the third consecutive session as investors balanced robust economic data against the anticipated Federal Reserve rate cuts in the future. The S&P 500 and Nasdaq 100 each decreased by 0.5%, while the Dow Jones Industrial Average dropped by 175 points, with all sectors except energy experiencing losses. The number of initial jobless claims fell to 218,000 for the week ending September 20, indicating a strong labor market. Furthermore, second-quarter GDP growth was significantly revised upwards to an annualized rate of 3.8%, driven by strong consumer spending and business investments.
Investors are now adjusting their expectations regarding the Federal Reserve’s forthcoming actions, with the probability of an additional 25 basis point rate cut in October decreasing considerably. Technology stocks were the hardest hit, with Oracle down by 5% and Tesla by 4%. CarMax's shares plunged by 20% following disappointing earnings results, whereas Intel's shares rose by 9% due to reports of approaching Apple for an investment. Investors are now looking forward to the release of the Federal Reserve's preferred inflation metric, the PCE index, on Friday, for further insights into the Fed’s potential next steps.
