by Chuck Mikolajczak

(Reuters) – The New York Stock Exchange ended lower on Thursday after comments from U.S. Federal Reserve Chairman Jerome Powell and as Treasury yields rose.

The Dow Jones index fell -0.65%, or 220.33 points, to 33,891.94 points.

The broader S&P-500 lost 35.43 points, or -0.81%, to 4,347.35 points.

The Nasdaq Composite fell 128.97 points (-0.94%) to 13,521.45 points.

Jerome Powell said Thursday that Fed officials are “not convinced” that interest rates are high enough to combat inflation and that improving the supply of goods, services and of labor may no longer be of much help.

The market was slightly lower ahead of the central bank president’s comments, as yields rose after an auction of 30-year Treasury bonds. The 10-year Treasury yield reached 4.654% on the day.

Jerome Powell is “again taking a hawkish view,” said Peter Cardillo, chief economist at Spartan Capital Securities. “It (indicates) to the market that the battle against inflation has not been won and that, if economic conditions warrant, they will not hesitate to raise rates again.”

“If you add up all the comments, (Jerome Powell) is telling the market not to rest on its laurels, which is putting some pressure on stocks.”

A majority of traders believe the Fed will keep rates unchanged until the end of the year, even after Jerome Powell’s statements, but expect rate cuts to begin later in 2024, according to CME’s Fedtwatch barometer Group.

The US Department of Labor also indicated on Thursday that unemployment claims fell in the United States last week, to 217,000 compared to 220,000 (revised) the previous week.

In terms of values, Walt Disney jumped after reporting quarterly results above expectations on Wednesday.

Arm Holdings fell after the chip designer said it expects lower-than-expected sales for the current quarter.

The eleven sectoral indices of the S&P 500 finished lower, notably those of health care and consumer discretionary.

(Reporting Chuck Mikolajczak, with contributions from Stephen Culp; Camille Raynaud)

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