Stocks fall as investors face medley of Fedspeak and earnings

U.S. stocks faltered Thursday as optimism around easing inflation and a Federal Reserve policy shift waned, while Wall Street parsed through a motley of corporate earnings.

The S&P 500 (^GSPC) was down 0.3% after coming off of a session low of more than 1%, while the Dow Jones Industrial Average (^DJI) was down about 0.1%, paring a loss of more than 300 points. The technology-focused Nasdaq Composite (^IXIC) edged down 0.2%.

Comments from St. Louis Federal Reserve President James Bullard weighed on investor sentiment early Thursday as he suggested the Fed’s monetary tightening campaign has so far had “limited effects” on observed inflation and that even a “dovish” policy from here would need to spike the federal funds rate at least another percentage point.

Investors are in for a prolific day of Fedspeak, with several Fed policymakers scheduled to give public remarks across the country Thursday.

In the economic data spotlight, filings for unemployment insurance fell last week, holding near historic lows even as a flurry of technology companies report layoff plans. Initial jobless claims, the most timely snapshot of the labor market, came in at 222,000 for the week ended Nov. 12, a decrease of 4,000 from the prior week, Labor Department data showed Thursday.

A recent uptrend across equity markets lost steam Wednesday after strong October retail data offset hopes for a central bank policy shift, recently reignited by a string of lighter inflation reports. An earnings miss from Target also weighed on sentiment in Wednesday’s session, with the company citing inflation and a deteriorating economic backdrop ahead of the key holiday shopping season.

Other sector peers fared better during the period.

Macy’s (M) shares surged more than 7% at the open after the department store giant beat estimates and raised its full-year earnings guidance, buoyed by strong demand in the luxury areas of its business. Kohl’s (KSS), meanwhile, topped earnings expectations but withdrew its outlook for the full year due to “significant” macroeconomic headwinds and the unexpected transition of its chief executive officer. Shares fell nearly 3% to start the session.

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Shares of Bath & Body Works (BBWI) soared 26% at the start of trading after the personal care and home fragrance producer lifted its full-year profit outlook. Retailers Walmart (WMT), Lowe’s (LOW), the Home Depot (HD), all beat analyst estimates.

Elsewhere, as the earnings season reaches its final stretch, Nvidia (NVDA) Chief Executive Officer Jensen Huang said strong chip demand will help the company through potential economic challenges – an assurance that was enough to offset losses in its gaming business. Shares slipped 1%.

Machine maker Cisco Systems (CSCO) saw shares bounce 3% after the company delivered a positive revenue outlook and said it was slashing its workforce and reducing office space.