The benchmark S&P 500 ended little changed on Thursday as a fall in U.S. jobless claims offset data showing a contraction in U.S. manufacturing activity while investors awaited Federal Reserve Chair Jerome Powell’s speech on Friday for clues on the central bank’s monetary policy. Data from the U.S. Labor Department showed initial claims for state unemployment benefits dropped more than expected last week, suggesting the labor market was holding firm despite a manufacturing slowdown and concerns the economy is on a path toward recession.

However, IHS Markit’s Flash Purchasing Managers’ Index showed manufacturing activity contracting in August for the first time in nearly a decade. The reading prompted concern among some investors that economic weakness abroad and an escalating trade war with China could drag down the U.S. economy. Following the data release, the yield curve between two-year and 10-year Treasury notes briefly inverted.

For much of the session, the S&P 500 oscillated between gains and losses. Several market strategists said investors were pausing ahead of Fed Chair Powell’s speech on Friday at an annual gathering of central bankers in Jackson Hole, Wyoming, which is expected to yield some clues on whether the Fed will cut interest rates further. The benchmark index dipped lower in intraday trade after Philadelphia Fed President Patrick Harker and Kansas City Fed President Esther George hinted at less dovish stances, saying the U.S. economy does not need more stimulus at this point.

The Dow Jones Industrial Average rose 49.51 points, or 0.19 per cent, to 26,252.24, the S&P 500 lost 1.48 points, or 0.05 per cent, to 2,922.95 and the Nasdaq Composite dropped 28.82 points, or 0.36 per cent, to 7,991.39.


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