Stock markets opened down for the third day in a row Thursday as an improving economic outlook has led to jitters among investors that federal support will be withdrawn more quickly than anticipated.
The Dow Jones Industrial Average slipped 150 points, or 0.5 percent, and the S&P 500 fell 19 points, also 0.5 percent, in opening trading.
The tech-heavy Nasdaq index fell 80 points, or 0.6 percent, as investors pulled back from technology stocks that some analysts see as overinflated.
After a precipitous crash at the start of the pandemic, the stock market has made an astonishing recovery over the past year, fueled by loose monetary policy and trillions of dollars in fiscal and monetary support.
But as the economic recovery takes shape, investors worry that the Federal Reserve in particular will start pulling back on the emergency measures that have helped fuel the stock market.
“As we make substantial further progress toward our goals, we’ll gradually roll back the amount of Treasuries and mortgage-backed securities we’ve bought,” Fed Chairman Jerome Powell told NPR in an interview published Wednesday.
“We will very gradually over time and with great transparency, when the economy has all but fully recovered, we will be pulling back the support that we provided during emergency times.”
The drop in markets comes as the Labor Department reported better-than-expected initial jobless claims of 684,000 Thursday.
The figure remains high by historical standards but is the lowest reading since the pandemic began and the first time in more than a year that the initial claims fell below their pre-pandemic peak of 695,000, set in 1982.
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