US stocks moved back and forth on Thursday as investors reacted to fresh economic data and waited for a key jobs report due later this week. The mood on Wall Street stayed cautious, with no clear direction through the afternoon.
By 2:22 pm ET, the Dow Jones Industrial Average was up 293 points, a gain of 0.6%. The S&P 500 slipped 0.1%. The Nasdaq Composite fell 0.6%, weighed down by losses in tech stocks.
New data showed that more Americans filed for unemployment benefits last week. Initial jobless claims rose by 8,000 to 208,000 for the week ending December 27. The increase was modest and suggested that layoffs remain limited. At the same time, it showed that hiring demand is still soft.
Another report offered a more positive signal. US worker productivity jumped at its fastest pace in 2 years during the third quarter. Productivity rose at an annual rate of 4.9%, according to the Labor Department. This followed a revised 4.1% increase in the second quarter and marked the strongest growth since the third quarter of 2023.
Investor focus is now shifting to Friday’s nonfarm payrolls report. The data is expected to give clearer insight into job growth and wages. Markets are closely watching the numbers to judge when and how aggressively the Federal Reserve may cut interest rates.
Federal Reserve Governor Stephen Miran said on Thursday that he expects interest rates to be cut by about 150 basis points this year. He said inflation is now close to the Fed’s target and believes rate cuts are needed to support the labor market. Miran’s term at the Fed ends later this month.
Earlier this week, private payroll data from ADP showed that job growth in December was weaker than expected. While the ADP report is known to be volatile, it added to signs that hiring is slowing toward the end of the year.
Geopolitical tensions also stayed in the background. Markets showed little reaction after the US captured Venezuelan President Nicolas Maduro. Investors have largely ignored the political shock so far, though it has raised new questions for energy markets.
Oil prices edged higher on Thursday after falling for 2 straight sessions. Gains were limited after reports that the US plans to control Venezuelan oil production for the long term. Concerns remain that increased output from Venezuela could add to a global supply glut.
President Trump said earlier this week that Venezuela would hand over between 30 million and 50 million barrels of oil to the US, valued at up to $3 billion. Oil prices also found support from data showing a larger than expected drop in US crude inventories and ongoing conflict between Russia and Ukraine.
Brent crude rose 1.6% to $60.95 a barrel. US West Texas Intermediate crude gained 1.5% to $56.83 a barrel. Both had fallen more than 1% in each of the past 2 sessions.
In the corporate space, housing and defense stocks drew attention after a series of policy announcements from Trump. He said he plans to stop large investors from buying single family homes to ease the housing shortage.
Trump also said he wants to ban defense companies from paying dividends or buying back shares. He called for US defense spending to rise by more than 50% to $1.5 trillion by 2027. It is still unclear whether these measures can be enforced without approval from Congress.
Investors are also waiting for the Supreme Court’s rulings on the legality of Trump’s tariffs. The decisions are expected to be released on Friday and could have major implications for trade and markets.