Dow futures fell 270 points on fears of Fed overreach

Stocks were set for a second straight day of losses as investors grew worried that the Federal Reserve would raise interest rates despite signs of easing inflation.

Futures for the Dow Jones industrial average fell 274 points, or 0.8%. S&P 500 futures and Nasdaq 100 futures fell 0.8% and 0.9%, respectively.

Initial filings for unemployment insurance fell last week to the lowest level since late June The Labor Department said ThursdayIt signals to investors that the labor market is resilient amid a sluggish economy.

Seasonally adjusted claims totaled 190,000 for the week ended Jan. 14, down 15,000 from the prior period. Economists polled by Dow Jones surveyed 215,000.

Investors are sifting through the latest data and Fed comments for clues on how higher rates will go. But while the latest numbers show inflation is slowing, JP Morgan Chase CEO Jamie Dimon thinks rates will stay at 5%.

“I think there’s a lot of underlying inflation,” Dimon told CNBC’s “Squawk Box” from the World Economic Forum in Davos, Switzerland.

Wall Street is coming off a losing session. The S&P 500 fell 1.56% on Wednesday, its worst day since Dec. 15. The Dow fell more than 613 points, or 1.81%. The tech-heavy Nasdaq Composite fell 1.24%, snapping seven days of gains. Bank stocks such as JP Morgan, Bank of America and Wells Fargo fell, weighing on the broader market.

Disappointing retail sales and a weaker-than-expected producer price index fueled recession fears, sending stocks lower.

Elsewhere, investors are looking to key quarterly reports to see if an earnings slowdown is brewing. Netflix and Truist Financial are among the companies reporting earnings on Thursday.

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