U.S. stocks pared losses into the final hour of trading Thursday as equities looked to recover from a downbeat start to September trading. The moves come after all three major averages registered their biggest August percentage declines since 2015.
The Dow Jones Industrial Average teetered into positive territory after plunging nearly 300 points, and the S&P 500 was down 0.4%, clawing back from a loss of more than 1% earlier in the session. Tech led losses, with he Nasdaq Composite off by 1%.
Meanwhile, the benchmark U.S. 10-year Treasury yield reached 3.257%, its highest level since June as investors brace for more aggressive interest rate hikes from the Federal Reserve later this month.
A downbeat start to September comes on the heels of four straight sessions of selling amid renewed fears of restrictive monetary policy and a potential recession.
In August, the benchmark S&P 500 fell 4.2%, the Dow was down 4.1%, and the Nasdaq posted a monthly loss of 4.6%.
“A soft landing looks pretty unlikely,” Wells Fargo Head of Macro Strategy Mike Schumacher told Yahoo Finance Live. “A lot of things would have to go incredibly well — you'd have to have the energy situation ease, which is shy of a miracle at this point, COVID probably has to be pretty moderate if you think about a surge this fall or this winter.”
Nvidia shares (NVDA) were among Thursday's biggest movers, falling as much as 10% after the chipmaker said U.S. officials ordered the company to halt sales to China of two of its top computing chips used for artificial intelligence. Nvidia may lose an estimated $400 million in potential sales in China as a result of the restriction.
In commodities, oil prices extended their fall lower as worries of demand destruction persist. West Texas Intermediate crude oil fell more than 2.5% to as low as $87.21.
The moves in crude oil futures come after the commodity logged its third straight monthly decline – the longest losing streak in more than two years. WTI crude sank more than 9% in August, its biggest monthly decline since November.
On the economic data front Thursday morning, jobless claims fell for a third week to the lowest reading in two months. First-time unemployment insurance filings fell unexpectedly to 232,000 in the week ended August 27. Economists surveyed by Bloomberg expected claims to come in at 248,000.
Meanwhile, the Commerce Department reported Thursday that spending on new construction projects fell 0.4% in July, on par with economist estimates. Spending in June fell a revised 0.5% compared to the heftier prior estimate of a 1.1% drop.
The main event of the week is the Labor Department’s official report for August, set for release at 8:30 a.m. ET Friday morning. Nonfarm payrolls likely rose by 300,000 in August, according to data from Bloomberg.
Alexandra Semenova is a reporter for Yahoo Finance. Follow her on Twitter @alexandraandnyc