US stock markets closed lower on Thursday. After small gains during trading, markets turned significantly red in late trade. The Dow Jones ended the day down 1.35 percent at 38,596.98. The broader S&P 500 fell 1.23 percent to 5,147.21 points. The tech-heavy Nasdaq composite lost 1.40 percent to 16,049.08 points. The shift in sentiment was prompted by Fed member Neel Kashkari's statements.
That jolted investors who had been jittery ahead of Friday's key labor market report along with interest rate reports. According to his assessment, there is no need to cut interest rates this year. That would apply if there was progress in reducing inflation, the head of the regional central bank in Minneapolis said. The reports came as a cold shower to investors who were ultimately holding out for interest rate cuts this year.
The US government's labor market report for March, due on Friday, is now eagerly awaited. Initial jobless claims data released on Thursday indicated that the labor market remained strong. Although applications increased in the previous week, they remained relatively low.
