The Nasdaq Composite edged lower Thursday, weighed down by a decline in shares of technology and financial companies.
The tech-heavy index fell 0.5%. The S&P 500 declined 0.2%, and the Dow Jones Industrial Average edged up around 90 points, or 0.3%, to 32756.
Markets have come under pressure lately as investors have reckoned with the prospect of interest rates staying higher for longer. Economic data have shown inflation has remained stubbornly high, despite the Federal Reserve’s rate increases over the past year. Data Thursday showed that weekly jobless claims, considered a proxy for layoffs, were lower than expected, pointing to continued tightness in the labor market.
Strong data, combined with some hawkish comments from Fed officials, has made some investors and analysts believe the central bank is likely to keep tightening monetary policy longer than previously anticipated.
Bonds retreated again Thursday, with the yield on the 10-year U.S. Treasury note rising to 4.067% from 3.994% Wednesday. The 10-year yield, which influences everything from student debt to mortgage rates, climbed Wednesday to its highest closing level since November.
“The market is expecting slightly higher rates for longer and that has pushed up bond yields and equities have taken a pause,” said Des Lawrence, senior investment strategist at State Street Global Advisors.
Growth stocks, which tend to be sensitive to rising interest rates, were among the bigger decliners in the market Thursday.
Shares in
dropped 6% after Chief Executive
and his colleagues laid out their vision for the electric car maker.
slipped 1.5%.
bucked the trend, surging 13% after the software provider said it expects widening profit margins and more revenue than analysts had forecast.
Financial stocks also came under pressure. The KBW Nasdaq Bank Index of lenders dropped 2.2%.
U.S. stocks have diverged in 2023, with the Dow Jones Industrial Average down 1.5% through Wednesday’s close, compared with an 8.7% rise for the Nasdaq Composite.
Photo:
William Volcov/Zuma Press
In commodity markets, Brent crude prices rose. The international oil benchmark increased 0.5% to $84.70 a barrel, as investors weighed a rise in U.S. inventories against the likelihood that China’s reopening would boost demand.
In Europe, indexes rose after data showed eurozone inflation easing. The pan-continental Stoxx Europe 600 edged up 0.3%.
The Hang Seng Index fell 0.9% in Hong Kong, while Japan’s Nikkei 225 and the Shanghai Composite both declined roughly 0.1%.
—Akane Otani contributed to this article.
Write to Will Horner at william.horner@wsj.com
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