US stocks closed lower after economic data increased uncertainty about the Federal Reserve's (Fed) interest rate cut outlook.
Data showed initial jobless claims fell by 14,000 to 218,000 for the week ended September 20 after seasonal adjustments.
In addition, other data recorded that the US economy grew faster in the second quarter supported by strong consumer spending and business investment.
The report comes after the US central bank last week cut rates by 25 basis points, the first cut since December 2024 as labor market weakness opened the way for more cuts in the future.
Fed Chairman Jerome Powell also stressed that the Fed needs to balance inflation concerns with labor market weakness in its future interest rate decisions.
According to CME FedWatch, investors now rate the chance of a 25 basis point interest rate cut at the October Fed meeting at 83.4%, down from around 92% on Wednesday.
Investors are also awaiting the Personal Consumer Expenditures (PCE) Price Index, the Fed's preferred inflation gauge, which will be published on Friday at 8.30pm Malaysian time.
The S&P 500 index fell 0.50% to 6,604.72 points, the Dow Jones fell 0.38% to 45,947.32 points, while the technology-focused Nasdaq fell 0.50% to 22,384.70 points.
Meanwhile, shares of CarMax fell 20.1% after the used car retailer reported lower second-quarter profit.
Accenture shares also fell 2.7% despite the company reporting better-than-expected revenue.
