U.S. stocks fell in choppy trading on Thursday as investors weighed in on several economic reports that painted a muddy picture of the U.S. economy.
The Nasdaq Composite fell 1.7%, while the S&P 500 fell 1.3%. The Dow Jones Industrial Average outperformed, but was still down 200 points, or 0.6%.
Adobe shares weighed on the Nasdaq and the S&P 500. The software stock fell 15% after the company announced a $20 billion deal to buy Figma.
Financial stocks outperformed, with Goldman Sachs and JPMorgan each rising more than 2%. UnitedHealth Group rose more than 3%. Energy stocks were under pressure, however, with Chevron falling 1.5%.
Initial jobless claims came in better than expected on Thursday, but import prices fell less than estimates suggested. Retail sales beat expectations but were negative if autos are excluded. Manufacturing data also showed a slowdown in the economy. While these reports suggest that the US consumer sector is holding up for now, they will do little to ease concerns about lingering inflation.
Wall Street is coming off a choppy session in which the major averages posted modest gains but did little in Tuesday’s massive sell-off. Wall Street is still trying to find its footing after a surprise increase in the consumer price index in August sent the Dow down more than 1,200 points on Tuesday.
Stubbornly high inflation has investors fearing the Federal Reserve will be more aggressive with its rate hikes, raising the odds of a US recession.
“The Fed has to pick its poison. Do you go ahead to suppress inflation at the risk of recession, at the risk of increasing unemployment? It’s really a dilemma, but I think given what we’ve heard from the Fed, the focus is squarely on inflation,” said Mike Loewengart, head of model portfolio construction at Morgan Stanley.