S&P 500 Stalls Amid Caution on Wall Street Ahead of Powell

© Reuters.

By Yasin Ebrahim

Investing.com – The S&P 500 stumbled Thursday, as investors erred on the side of caution amid expectations the Federal Reserve could drop its clearest hint yet that loose monetary policy measures will be reined in sooner rather than later.  

The S&P 500 fell 0.6%, the Dow Jones Industrial Average slipped 0.5%, or 192 points, and the Nasdaq fell 0.6%.

Ahead of the symposium on Friday, Fed speakers have signaled that the central bank is keen to begin tapering its monthly bond purchases to avoid having to play catchup later down line and risk more aggressive moves to curb inflation.     

“I think we want to get going on taper. Get the taper finished by the end of the first quarter next year,” James Bullard, St. Louis Fed President told CNBC Thursday. “And then we can evaluate what the situation is and we’ll be able to see at that point whether inflation has moderated and if that’s the case we’ll be in great shape. If it hasn’t moderated, we’re going to have to be more aggressive to contain inflation.”

The remarks arrived as investors digested mixed economic data as the weekly jobless claims climbed, while another take on second-quarter economic growth fell just short of estimates.       

Initial jobless claims totaled 353,000 last week, just above expectations of 350,000, while the penultimate reading of second-quarter GDP was 6.6%, just shy of the 6.7% expected.

The weaker data out from the labor market, however, isn't a reason for worry amid expectations that the trend of the falling claims is likely still intact.

"Although there was an uptick this week, we do not think there is anything to be particularly concerned about here," Jefferies (NYSE:JEF) said in a note following the weekly jobless claims data. "The back up is not big enough to signify any fundamental change in the flows of the labor market."

On the earnings front, meanwhile, Salesforce (NYSE:CRM) was in the spotlight, rising  more than 2% after delivering an upbeat outlook on annual performance following quarterly results that topped wall street estimates.

Ulta Beauty (NASDAQ:ULTA) gave up its gains to trade flat even as the cosmetics retailer reported a beat on both the top and bottom lines, led by a strong recovery in its beauty business.

Megacap tech stocks were largely below the flatline.

Apple (NASDAQ:AAPL), Microsoft Corporation (NASDAQ:MSFT), Facebook (NASDAQ:FB), and Google-parent Alphabet (NASDAQ:GOOGL) were lower.