US equities were mixed during Thursday's midday trading session, with the Dow Jones Industrial Average reaching a new intraday record high, while the Nasdaq and S&P 500 indices turned lower. A weaker-than-expected US June non-farm payrolls report has led markets to believe the Federal Reserve will hold off on further interest rate hikes as a result.
The Dow Jones Industrial Average gained 352.83 points, or 0.67%, to 52,658.07. The Nasdaq Composite fell 225.48 points, or 0.87%, to 25,814.56. The S&P 500 index declined by 15.92 points, or 0.21%, to 7,467.31.
Earlier on Thursday, the Dow reached a new all-time high of 52,805.12.
US markets will be closed on Friday in observance of the Independence Day holiday. As July 4th falls on a Saturday in 2026, US financial markets will observe the holiday on Friday, July 3rd, in accordance with regulations. Due to this holiday, some futures contracts on the CME and ICE exchanges will also close early.
The US June non-farm payrolls report, released a day early on Thursday, showed the economy added 57,000 jobs last month. This figure was below the 115,000 jobs forecast by economists surveyed by Dow Jones. However, the unemployment rate fell to 4.2%, whereas economists had expected it to remain at 4.3%.
In response to this data, the yield on the 2-year Treasury note declined, as markets interpreted the figures as a signal for the Federal Reserve to pause its rate-hiking cycle.
Federal Reserve Chair Kevin Warsh, speaking at the European Central Bank's Sintra Forum on Wednesday, stated that the Fed is "charting a new path." He indicated that future monetary policy will be formulated based on a new real-time data system, moving away from reliance on official statistical reports that suffer from lags and biases.
"My vision is that within 9 to 12 months, we will utilize new technology to track the real economy in real-time, allowing central bank decisions to be based on synchronized, immediate data, leading to more precise policy judgments," Warsh said. He established five specialized working groups last month, one of which is dedicated to finding new data sources and methodologies. The membership list for this group is scheduled to be announced next week.
On the issue of inflation, Warsh's remarks struck a nuanced, dual tone. He explicitly acknowledged that "the price level is too high" and reiterated the Fed's commitment to achieving its 2% inflation target, stating that anyone who thinks the Fed would be comfortable with inflation above 2% would be "disappointed." However, he also noted that inflation expectations and inflation risks have moderated over the past four weeks.
Warsh also expressed new thinking regarding the assessment of inflation itself. He has long favored the Dallas Fed's "trimmed mean" inflation measure, which shows a rate of inflation (around 2.4%) significantly lower than the official CPI (4.2%) and PCE (4.1%) figures. His proposed reforms suggest the Fed may incorporate a more diverse set of inflation indicators into its decision-making framework.
Furthermore, Warsh again emphasized the Federal Reserve's policy independence and reiterated that it would not provide forward guidance on interest rates, stating that policy decisions would depend entirely on incoming data.
Ahead of the release of the June jobs data, major US stock indices closed lower on Wednesday as investors reduced positions in chipmakers. Chip stocks provided support for index futures on Thursday, with Advanced Micro Devices and Intel both gaining over 2%, and Micron Technology rising more than 3%.
Although the decline in the chip sector weighed on the broader market in the previous session, Rob Anderson, a strategist at Ned Davis Research, views the rotation of funds out of semiconductors as a healthy development.
"Rotation is a hallmark of a bull market. This characteristic has been on full display in 2026," he wrote. "The baton being passed to non-commodity cyclical sectors would further prove that the stock market is entering the second half of the year with strength and that the bull market can persist deeper into the second half."
In Asian markets on Thursday, South Korea's KOSPI index led the declines, closing down 7.89% at 7,648.09, its lowest closing level since June 8th. The small-cap KOSDAQ index fell 6.74% to 866.72. Index heavyweight Samsung Electronics dropped 9.06% to 286,000 won, while SK Hynix plunged 14.57% to 2,187,000 won.
Japan's Nikkei 225 index fell 2.47% to 68,733.15, while the Topix index edged up 0.09% to 4,014.98. Australia's benchmark S&P/ASX 200 index was flat at 8,724.50.
The pan-European Stoxx 600 index was up 0.6% in early trading, reversing earlier losses. Technology stocks faced selling pressure, with traders rotating into defensive sectors such as utilities, healthcare, and consumer staples.
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