S&P 500 and Nasdaq 100 contracts were little changed as AT&T Inc. and American Airlines Group Inc. climbed in premarket trading after beating estimates Tesla Inc., however, dropped after the electric-vehicle maker’s miss on sales. Oil stocks and luxury names outperformed in Europe. 

Truss resigned Thursday as UK prime minister after a brief and chaotic tenure that saw her announce a massive package of unfunded tax cuts before unwinding most of it in the face of a market rout.

The yen weakened past the closely watched 150 per dollar level, marking a 32-year low and keeping investors on high alert for further intervention to support it. The move followed a surge in US Treasury yields to multi-year highs that widened the gap with Japanese equivalents. A Bloomberg gauge of dollar strength edged lower.

A generally strong start to the third-quarter earnings season has bolstered sentiment toward equities. But investors are having to balance signs of corporate resilience against fears about the impact of persistent inflation, hawkish moves by the Federal Reserve and other central banks and threats to the economy.

“I think the market now is looking at 2023 and baking some kind of mild downturn into the price,” Hugh Gimber, global market strategist at JPMorgan Asset Management, said on Bloomberg Television. “The key is that inflation number coming down, because if it does, 5% for the Fed looks to me roughly as the right figure and then the market can have a clearer picture.”

In the latest data for Fed policymakers to parse, jobless claims unexpectedly fell to a three-week low, indicating firm labor demand for workers despite concerns about the economy.

Initial unemployment claims declined by 12,000 to 214,000 in the week ended Oct. 15, Labor Department data showed Thursday. The median estimate in a Bloomberg survey of economists called for 233,000 new applications.US weekly jobless claims fell to 214,000 against estimates for 233,000.

Federal Reserve Bank of St. Louis President James Bullard said he expected the US central bank to end its “front-loading” of aggressive interest-rate hikes by early next year and shift to keeping policy sufficiently restrictive with small adjustments as inflation cools.

The Fed is expected to raise interest rates by 75 basis points at its Nov. 1-2 meeting — its fourth straight increase of that size — as central bankers seek to cool the hottest inflation in four decades. 

Elsewhere in markets, oil advanced as Chinese officials debated easing some Covid rules, a policy that has weighed on its economy and energy demand. Gold rose after trading near a three-week low.