Wall Street’s main indices opened lower on Thursday, weighed down by a revised US GDP growth rate of 3.8%.In addition, the Labour Department reported 218,000 seasonally adjusted jobless claims for the week ending September 20, a decrease of 14,000 from the previous week’s upwardly revised figure and below the Dow Jones consensus estimate of 235,000.
Investors are also assessing comments from Kansas City Federal Reserve President Jeffrey Schmid, whose remarks tempered expectations for further interest rate cuts.
In the early hours of trading, Dow Jones Industrial Average dip 23.8 points (0.05%) to 46,097.43. S&P 500 dropped 29.8 points (0.45%) to 6,608.19, while the Nasdaq Composite fell 179.1 points (0.80%) to 22,318.77.
US economy grew more strongly than initially reported in the second quarter, expanding at an annual rate of 3.8%, up from the earlier estimate of 3.3%. The upward revision was driven by stronger consumer spending, a decline in imports, and increased business investment, particularly in Artificial Intelligence (AI).
This rebound followed a weak first quarter, during which the economy contracted by 0.6%, slightly worse than previously thought. The decline was partly attributed to a surge in imports as businesses rushed to beat incoming tariffs introduced under President Donald Trump’s trade policies. That front-loading of imports dragged down GDP early in the year, but as imports normalized in Q2, economic activity recovered.
On the labour front, the number of Americans filing new claims for unemployment benefits fell by 14,000 to a seasonally adjusted 218,000 for the week ending September 20, according to the Labor Department.
While jobless claims remain relatively low, the broader labour market is showing signs of cooling. Businesses continue to retain workers but are hesitant to expand their workforce amid trade-related uncertainties and a hiring slowdown. Protectionist trade measures have pushed the nation’s average tariff rate to its highest level in a century, adding to business caution.