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Traders work on the floor of the New York Stock Exchange during morning trading on October 04, 2023 in New York City.
Michael M. Santiago | Getty Images
Stocks were little changed Thursday as investors were cautious ahead of key jobs data on Friday that could determine the next move for interest rates.
The Dow Jones Industrial Average inched down 7 points, or 0.03%. The S&P 500 and Nasdaq Composite traded down 0.06% and 0.05%, respectively.
Consumer staples companies led the broad market index’s losses Thursday. Shares of beverage company Molson Coors fell more than 6% Thursday, followed by Clorox and PepsiCo, which declined more than 5%.
Weekly initial jobless claims came in at 207,000 for the week ending Sept. 30, up just 2,000 from the prior week’s numbers. Economists had forecasted 210,000, according to a Dow Jones consensus estimate. While the slight increase in jobless claims was about in-line with the Street, it disappointed some investors hoping the weekly data would start to signal a labor market breakdown and end the run in rates that’s hurting stocks.
The 10-year Treasury yield initially ticked up after the jobless claims report before inching down. It was last yielding 4.714%.
“We’re in the middle of a transition from what everybody thinks is a low rate environment, to a kind of more normalized rate environment. These adjustment periods are tough,” said Horizon Investments chief investment officer Scott Ladner.
On Friday, economists polled by Dow Jones believe nonfarm payrolls for September will show a 170,000 increase, down from a 187,000 jobs gain in August. While investors aren’t hoping for a recession, they are wishing for some labor market weakness that would cause the Federal Reserve to rethink raising rates again and halt the run in Treasury yields to 16-year highs.
Ladner is optimistic that the labor market is softening “in the most healthy way” when digesting the jobless claims and payroll data, ahead of the September jobs report.
“The totality of the labor market data is telling us that things are getting better. But they’re getting better in terms of numbers getting softer [and] less hot, and doing so in the most healthy way, which is essentially less less hiring, but still not very much firing,” Ladner said.
Stocks got a slight boost on Wednesday after the latest payroll data from ADP signaled to investors that the labor market is beginning to loosen.
Nonetheless, the broad market index and the 30-stock Dow are on pace for a losing week. The Dow is down 1.1% week to date, and turned negative for the year during Tuesday’s selloff. The S&P 500 is lower 0.5% for the week, while the Nasdaq is up just 0.1%.
— CNBC’s Yun Li contributed reporting.
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