US stocks slump as Fed officials see more rate hikes in the pipeline to tame inflation

• US stocks fell Thursday as central bank officials dampened hopes for a so-called Fed pivot.
• Fed regional presidents James Bullard and Esther George see more rate hikes in store to cool inflation.

US stocks dropped Thursday with the S&P 500 was on course for a second down day as Federal Reserve officials suggested the central bank is not close to finishing its work in raising interest rates to cool down inflation.

According to prepared remarks, St. Louis Federal Reserve President James Bullard said, "Thus far, the change in the monetary policy stance appears to have had only limited effects on observed inflation, but market pricing suggests disinflation is expected in 2023."

Investors also assessed quarterly financial results from retailers and economic data. Macy's jumped after raising its yearly earnings forecast while Kohl's fell after pulling its outlook for the year. Weekly jobless claims declined by 4,000 to 222,000 while factory activity in the Philadelphia area sharply dropped by more than expected.

Here's where US indexes stood at the 9:30 a.m. opening bell on Thursday:

• S&P 500: 3,916.24, down 1.07%

• Dow Jones Industrial Average: 33,300.17, down 0.76% (253.66 points)

• Nasdaq Composite: 11,028.38, down 1.39%

The Fed this year has pushed up its key interest rate by 375 basis points from 0%, including four consecutive hikes of 75 basis points.

"To attain a sufficiently restrictive level, the policy rate will need to be increased further," said Bullard.

Separately, Kansas City Fed President Esther George told The Wall Street Journal it may not be possible to reduce such high levels of inflation without the economy shifting into a recession.

"I have not in my 40 years with the Fed seen a time of this kind of tightening that you didn't get some painful outcomes," she said in an interview published Wednesday. She also said expectations for the Fed to stop raising rates were premature as she pointed to strong price pressures in labor-intensive service sectors.

Here's what else is happening today:

• The Conservative Party-led UK government laid out a 55 billion pound ($65 billion) budget. The government is aiming to restore its credibility after a prior tax plan drove the pound to an all-time low.
• "Big Short" investor Michael Burry touted gold as a winner from the FTX fiasco and teased a bet against the stock market.
• Americans are reportedly paying the biggest-ever premium for diesel at the pump after the fuel rose in price by 50%.

In commodities, bonds, and crypto:

• West Texas Intermediate crude lost 1.9% to $84 per barrel. Brent crude, the international benchmark, fell 1.4% to $91.60.
• Gold declined by 0.9% to $1,760.50 per ounce.
• The 10-year Treasury yield fell 4 basis points to 3.75%.
• Bitcoin slipped 0.4% to $16,476.11.