Wall Street ticks lower amid labour market concerns and weak earnings
In the US, first-time jobless claims rose more than expected last week to 235,000, according to the US Department of Labor, fuelling concerns that the labour market is losing steam.
Meanwhile, investor sentiment was further dented by retail titan Walmart posting disappointing results. Even though the retail giant reported increases in second-quarter profits and sales on Thursday, despite a challenging tariff environment, it missed Wall Street's profit expectations.
Poor results for Walmart
The nation's largest retailer dipped 4.3% shortly after the US stock market opened, despite raising its annual profit and sales outlook.
Walmart is among the first group of major US retailers this week to report quarterly results that should shed more light on how consumers are coping with rising prices because of higher tariff costs.
Beauty and cosmetics maker Coty also did not fare as well as expected in its most recent quarter. Investors fled after the owner of CoverGirl and Clairol beauty brands posted an unexpected fourth-quarter loss, sending shares down more than 20% after hours. Sales fell 8% from the same period a year ago, and the company said it expects margins to continue to be pressured by lower sales and the impact of tariffs.
The S&P 500 started trading slightly below its close on Wednesday, the Dow Jones Industrial Average slid 0.2%, but the Nasdaq edged up 0.1% by 4.30pm in Europe.
Jackson Hole Banking Symposium
Wall Street's attention will turn to Jackson Hole, Wyoming, on Friday, when Fed Chair Jerome Powell will speak to an annual conference of central bankers.
The Fed has kept its main interest rate steady this year, concerned that President Donald Trump's tariff hikes could push inflation higher. But a surprisingly weak report on job growth across the US may be superseding that.
Still, minutes from the Fed's July 29-30 meeting, released Wednesday, showed most Fed officials felt the threat of higher inflation was a greater concern than the potential for job losses, leading the central bank to keep its key rate unchanged.
The Fed's inaction has infuriated Trump, who has publicly admonished Powell and other Fed officials, going so far as to demand that they resign.
On Wednesday, Fed governor Lisa Cook said she wouldn't leave her post after Trump called for her resignation on social media over an accusation from one of his officials that she committed mortgage fraud.
Investors—and the president—are hoping that Powell hints at a rate cut in his speech on Friday, which would likely give stocks and other investments a boost.
Markets in the rest of the world
In Europe, Germany's DAX was a few points up, Britain's FTSE 100 edged up by 0.2% while Paris' CAC 40 shed 0.5%.
Earlier, in Asian trading, Tokyo's Nikkei 225 fell 0.6% after a survey showed Japan's factory activity remained in contraction for the second month in August. The S&P Global Flash Japan Manufacturing Purchasing Managers' Index (PMI) increased to 49.9 in August from 48.9 in July, just below the 50 level marking the cut-off between growth and decline.
Regional manufacturers have been feeling pressure from Trump's higher tariffs on exports to the United States.
Hong Kong's Hang Seng index edged 0.2% lower, while the Shanghai composite index rose 0.1%.
"Asian markets walked into Thursday like a card room still heavy with last night's smoke—muted, watchful, waiting for the next cue out of Jackson Hole," Stephen Innes of SPI Asset Management said in a commentary.
The exception was Australia, where the S&P/ASX 200 index added 1.1% to 9,019.10, surpassing the 9,000 level for the first time in a rally driven by strong economic data and corporate earnings.
In South Korea, the Kospi added 0.4% after shedding some of its morning gains.
Taiwan's TAIEX climbed 1.4%, while India's Sensex added 0.3%.
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