Stocks fell on Thursday, indicating that tech stocks will lead declines for major indices as investors expected gains and evaluated new data on the US job market.
The S&P 500 fell 0.8%, while the Dow Jones Industrial Average fell 0.7%. The high-tech Nasdaq Composite continued its slide from Wednesday, falling 1.1%.
Unemployment claims, a proxy for the layoffs, remained above the pre-coronavirus pandemic peak of 695,000. New claims for unemployment benefits rose to 861,000 last week, halting a downward trend that pointed to an improving job market. Economists expected a decline in claims.
Stocks have taken a breather in recent sessions after rising for much of 2021. Some investors have been caught off guard by a rapid rise in government bond yields, which appeared to hit tech stocks that have benefited from years of low interest rates. Money managers are also concerned about high valuations.
Still, many investors remain optimistic about the outlook for the stocks. They point to the likely arrival of more fiscal stimulus as a factor that will drive economic growth and earnings higher in 2021, along with the reopening of sectors that have been hit hard by the pandemic.