The Dow Jones Industrial Average dropped another 500 points on Thursday as investors looked ahead towards March's jobs report due out on Friday for more clues on the Federal Reserve's next policy decision. The S&P 500 Index and Nasdaq Composite also lost 1.2% and 1.4%, respectively, as the broader market fell throughout the session.
Here's how the market settled on Thursday:
S&P 500 Index (NYSE: SPY): -1.23% or -64.28 ponts to 5,147.21
Dow Jones Industrial Average (NYSE: DIA): -1.35% or -529.84 points to 38,597.30
Nasdaq Composite Index (NASDAQ: QQQ): -1.40% or -228.38 points to 16,049.08
Zoom Out:
Market participants are trading cautiously at the start of the second quarter this week as Federal Reserve policy makers maintained outlooks that more data showing inflation easing its needed before the central bank can start cutting interest rates -- it is still broadly expected to issue three cuts this year.
So far this week, the Dow has fallen about 2%, while the S&P 500 has lost more than 1% and the Nasdaq has dipped slightly lower.
Zoom In:
On Thursday, Richmond Federal Reserve President Thomas Barkin echoed recent sentiment from his peers on in remarks, signalling that the central bank still needs more time to access the health of the economy in regards to inflation.
"While I don't see the economy overheating, the Fed knows how to respond if it does. And, if it slows, the Fed has enough firepower to support it as necessary," Barkin said. "In the interim, I think it is smart for the Fed to take our time."
In Economic News:
Initial unemployment claims rose at a more-than-expected rate for the week ended March 30, the Labor Department reported Thursday, totaling 221,000 to mark the highest weekly print since late January. Continuing jobless claims, which are tracked a week behind, dipped lower to a less-than-expected total of 1.79 million.
Separately, March saw the highest increase in planned layoffs in more than a year, according to a report from outplacement firm Challenger, Gray & Christmas on Thursday, though the firm noted that job cuts trended lower at the start of 2024.
The firm reported that announced layoffs last month totaled 90,309, increasing 7% month-to-month and marking the highest monthly total since January 2023. For the first quarter, total layoffs declined 5% year-over-year, with cuts in closely watched sectors like technology and media falling 59% and 33%, respectively, while transportation and industrial goods manufacturing jumped 483% and 726%, respectively.
On the Earnings Front:
Levi Strauss (NYSE: LEVI) shares popped on Thursday after the retailer raised its full-year profit forecast following a strong holiday quarter. The popular blue jeans brand said it expects adjusted earnings per share to now be between $1.17 and $1.27 for fiscal 2024, up from its previous range of $1.15 to $1.25.
"The benefits from our Project Fuel initiative are just starting to unfold, which will continue to improve the agility and the efficiency of our business," said CFO Harmit Singh during an earnings call with analysts late Wednesday. "We will continue to deliver positive free cash flow through inventory and working capital management."
For Friday:
All eyes will be on the Labor Department's nonfarm payrolls report for March, with economist consensus expecting for 200,000 jobs additions with an unemployment rate of 3.8%. A too hot jobs report could signal for the Fed to become more hawkish and maintain interest rates higher for longer.