U.S. initial jobless claims for the week ended Sept. 12 fell by 10,000 to 196,000, beating the 207,000 consensus estimate, according to data released Wednesday. The four-week moving average declined to 203,250, and continuing claims dropped to 1.730 million, underscoring resilience in the labor market even as the Federal Reserve has moved to tighten monetary policy.
The Labor Department data came just days after the Fed raised the federal funds rate by 25 basis points to 3.75%–4.00% on Wednesday, the first increase since 2023. Fed Chair Kevin Warsh said risks to the labor market are "roughly balanced," suggesting the central bank sees little urgency for further near-term tightening.
Equity markets turned in positive returns following Wednesday's selloff. The Dow Jones Industrial Average rose 0.5%, the S&P 500 gained 1%, and the Nasdaq Composite advanced 1.6%. The SPDR S&P 500 ETF Trust (SPY) traded at $754.05 intraday before recovering to $757.47 in post-market sessions.
In the housing sector, pending home sales rose 0.3% month-over-month in August to a reading of 71.2, slightly below the 0.4% consensus estimate, the National Association of Realtors reported. The figure reversed July's 2.6% decline but contract signings remain down 4.7% year-over-year and roughly 30% below pre-pandemic levels nationally. NAR Chief Economist Lawrence Yun noted that buyers continued entering contracts despite higher mortgage rates, though elevated borrowing costs are offsetting gains from job growth and income increases outpacing home price appreciation.
Across the Atlantic, the Bank of England held its benchmark interest rate steady at 3.75% on Thursday, keeping UK borrowing costs unchanged even as inflation pressures mount. U.K. CPI inflation climbed to 3.1% in August and is expected to rise further in coming quarters, driven in part by surging energy costs linked to the protracted conflict in the Middle East.
The Monetary Policy Committee also announced a multiyear plan to fully unwind its gilt holdings at an annual average pace of £46 billion through 2034, achieved via £20 billion in annual bond sales alongside maturing securities. The BOE's pause stands in contrast to the Fed's recent hike and the European Central Bank's second rate increase of the year announced the previous week, highlighting growing policy divergence among major central banks.
Meanwhile, Congress approved the Lindsey O. Graham Sanctioning Russia and Iran Act of 2026, clearing the way for President Donald Trump to sign the legislation, which follows Senate passage last month. The bill enables up to 100% tariffs on major purchasers of Russian oil and gas, including China and India. China — the top buyer of Russian crude — criticized the measure as lacking an international legal basis, while India stated it remains committed to diversified energy sourcing. Chinese President Xi Jinping is scheduled to meet President Trump the following week, making immediate escalation unlikely.
