US stocks end mixed as Fed Chair Powell's continued backing of stimulus raises economic questions

• US stocks ended mixed on Thursday, pulling back further from record highs notched earlier in the week.
• Fed chair Jerome Powell acknowledged hot inflation and said the central bank will continue to support the economy's recovery.
• Weekly jobless claims fell to a pandemic-era low of 360,000.

US stocks fell Thursday with investors appearing concerned about Federal Reserve Chairman Jerome Powell's message that the world's largest economy still needs recovery support from monetary policy.

Wall Street's major equity benchmarks were in the red, including the Nasdaq Composite as tech stocks lost grip of earlier gains. Stocks are coming off record highs that have been fueled in part by expectations of stronger quarterly corporate earnings.

Stocks struggled during the session after the release of mixed economic data. The Labor Department said initial weekly jobless claims fell by 26,000 to 360,000, a new pandemic-era low. Factory activity in the New York region is soaring as gauged by the Empire State Manufacturing Index while the Philly Fed Manufacturing Index came in below expectations.

Here's where US indexes stood at 4:00 p.m. on Thursday:

• S&P 500: 4,360.03, down 0.33%

• Dow Jones Industrial Average: 34,987.02, up 0.15% (53.79 points)
• Nasdaq Composite: 14,543.13, down 0.7%

In his second day of congressional testimony, Powell acknowledged a surge in consumer price inflation stemming from various efforts to jumpstart economic activity that was hit hard by the coronavirus crisis.

"This is a shock going through the system associated with reopening of the economy, and it has driven inflation well above 2%. And of course we're not comfortable with that," said Powell who also reiterated his view that inflationary pressures are transitory and indicated that tightening monetary policy won't take place anytime soon.

"Many people are struggling with, 'My day-to-day life is telling me that prices are higher, but the chairman is telling me that it's not going to last,'" JJ Kinahan, chief market strategist at TD Ameritrade, told Insider on Thursday.

As stocks dropped, investors continued to push into the bond market, driving yields lower.

"The bond market may be saying if [inflation] is going to last, we certainly have priced rates pretty low. It's a situation of we're going to have to be shown that it's transitory," Kinahan added.

In other developments, Powell said cryptocurrencies have failed to become a viable payment method.

GameStop shares fell following a Bloomberg report that Netflix hired video-game-industry veteran Mike Verdu to oversee a push into that space.

Oil prices fell after the United Arab Emirates and Saudi Arabia reached a compromise on production, with the former said to have secured a higher baseline for its crude output.

Life Clips has skyrocketed by more than 3,000% over the last two days after it announcing a pivot into blockchain.

Gold edged up 0.1%, to $1,828.84 per ounce. Long-dated US Treasury yields slipped, with the 10-year yield at 1.30%.

Oil prices pulled back, with West Texas Intermediate crude down 1.5% at $72.01 per barrel.

Bitcoin slumped 4.2%, to $31,435.40.