After turning in a lackluster performance early in the session, stocks showed a significant move to the downside over the course of the trading day on Thursday. The major averages all slid firmly into negative territory as the day progressed.
The major averages climbed off their worst levels going into the close but remained notably lower. The Dow tumbled 317.46 points or 1.1 percent to 29,080.17, the Nasdaq slid 76.84 points or 0.7 percent to 11,709.59 and the S&P 500 slumped 35.65 points or 1 percent to 3,537.01.
The considerable weakness that emerged on Wall Street came as the recent surge in coronavirus cases across the U.S. and Europe has led to renewed concerns about the economic outlook.
According to data from John Hopkins University, the U.S. reported more than 144,000 new coronavirus cases on Wednesday, a new one-day record high.
The seven-day average of new cases has skyrocketed to more than 127,400, reflecting a 35 percent spike compared with a week ago.
The jump in new cases has been accompanied by notable increases in hospitalizations and deaths, suggesting the surge is not only due to increased testing.
The latest wave of coronavirus cases has led to concerns about the economic impact of new restrictions and lockdowns.
During a European Central Bank Forum on Central Banking virtual event, Federal Reserve Chair Jerome Powell noted the economic outlook remains uncertain despite recent upbeat news about a potential coronavirus vaccine.
"From our standpoint, it's just too soon to assess with any confidence the implications of the news for the path of the economy, especially in the near term," Powell said. "With the virus spreading, the next few months could be challenging."
The virus concerns overshadowed a report from the Labor Department showing a bigger than expected decrease in first-time claims for unemployment benefits in the week ended November 7th.
The Labor Department said initial jobless claims fell to 709,000, a decrease of 48,000 from the previous week's revised level of 757,000.
Economists had expected jobless claims to dip to 735,000 from the 751,000 originally reported for the previous week.
With the bigger than expected decrease, jobless claims fell to their lowest level since before lockdowns were imposed in mid-March.
A separate report released by the Labor Department showed consumer prices came in flat in the month of October.
The Labor Department said its consumer price index was unchanged in October after rising by 0.2 percent in September. Economists had expected another 0.2 percent uptick.
Excluding food and energy prices, consumer prices were still flat in October after edging up by 0.2 percent in September. Core prices were also expected to inch up by another 0.2 percent.
Sector News
Airline stocks moved sharply lower over the course of the trading session, dragging the NYSE Arca Airline Index down by 4.1 percent. The index continued to give back ground after ending Tuesday's trading at a five-month closing high.
Substantial weakness also emerged among energy stocks, which moved lower as the price of crude oil for December delivery slipped $0.33 to $41.12 a barrel.
Reflecting the weakness in the energy sector, the NYSE Arca Oil Index plunged by 4.1 percent, the NYSE Arca Natural Gas Index tumbled by 3.3 percent and the Philadelphia Oil Service Index slumped by 3.1 percent.
Banking stocks also showed a significant move to the downside on the day, resulting in a 2.3 percent drop by the KBW Bank Index.
Chemical, housing and computer hardware stocks also saw considerable weakness, moving lower along with most of the other major sectors.
Other Markets
In overseas trading, stock markets across the Asia-Pacific region moved mostly lower on Thursday, although Japan's Nikkei 225 Index bucked the downtrend and rose by 0.7 percent. China's Shanghai Composite Index edged down by 0.1 percent and South Korea's Kospi fell by 0.4 percent.
The major European markets also moved to the downside on the day. While the U.K.'s FTSE 100 Index slid by 0.7 percent, the German DAX Index slumped by 1.2 percent and the French CAC 40 Index tumbled by 1.5 percent.
In the bond market, treasuries showed a notable rebound after trending lower over the past several sessions. As a result, the yield on the benchmark ten-year note, which moves opposite of its price, declined 8.7 basis points to 0.885 percent.
Looking Ahead
Earnings news may attract attention on Friday, with Disney (DIS), Cisco (CSCO) and Applied Materials (AMAT) among the companies releasing their quarterly results after the close of today's trading.
Trading could also be impacted by reaction to reports on producer price inflation in October and consumer sentiment in November.
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