Stocks spent most of Thursday in positive territory thanks to strong gains in several mega-cap names. However, the main indexes took a nosedive in the final hour of the session as anxiety ramped up ahead of tomorrow morning's release of the March nonfarm payroll report. 

Comments from Minneapolis Fed President Neel Kashkari also poured cold water on the market's earlier momentum. In an interview with Pensions and Investments Magazine, the central bank official wondered if it's even necessary to cut interest rates with the economy as strong as it is. "If we continue to see inflation moving sideways, it would make me question whether we needed to do those rate cuts at all," Kashkari said.

As a result, the Dow Jones Industrial Average finished the day down 1.4% at 38,596, the S&P 500 was 1.2% lower at 5,147, and the Nasdaq Composite had shed 1.4% to 16,049.

Several of the Magnificent 7 stocks were a source of strength early on. Tesla (TSLA), for one, bounced back from this week's dismal delivery-induced dive, adding 1.6%.

Shares of the electric vehicle maker are still down 31% for the year to date, but Ark Invest CEO Cathie Wood reiterated on CNBC's "Squawk Box" Wednesday that she thinks Tesla stock can reach $2,000 per share in the next five years. 

Meta adds $11 billion in market value

Meta Platforms ( META ) – a member of the Fab Four, the best-performing Mag 7 stocks of 2024 so far – was another notable gainer, adding 0.8%, or $11 billion in market value.

Lifting shares of the Facebook parent was a bullish note from Jefferies analyst Brent Thill. "We believe Meta could capture 50% of incremental industry ad dollars in 2024, which would be its highest ever and well above its 33% in 2023," Thill wrote in a note to clients, adding that early tests show the company's generative AI (artificial intelligence) efforts are driving click-through rates. 

Thill, who has a Buy rating on the communication services stock, lifted his target price on Meta to $585 from $550. This new price target represents implied upside of 14% to today's close. 

Lamb Weston ( LW ) crumbles after earnings

As for Thursday's notable decliners, Lamb Weston ( LW ) plunged 19.4% after the french fry maker disclosed its fiscal third-quarter results. For the three months ended February 25, earnings fell 18% year-over-year to $1.20 per share. Revenue rose 16% to $1.5 billion. Analysts, meanwhile, were forecasting earnings per share of $1.46 on $1.7 billion in revenue. 

"The transition to a new enterprise resource planning (ERP) system in North America negatively impacted our financial results in the quarter by more than we expected," said Tom Werner, CEO of Lamb Weston ( LW ), in a press release. 

The good news is that issue seems to be mostly isolated to Lamb Weston's ( LW ) fiscal Q3, says CFRA Research analyst Arun Sundaram, who kept a Buy rating on the consumer staples stock. However, the big unknown moving forward "is how restaurant traffic trends evolve as we enter fiscal 2025," he adds.

Initial jobless claims rise ahead of May jobs report 

In economic news, data from the Labor Department showed that initial jobless claims rose by 9,000 in the week ended March 23, more than economists were expecting.

While this does signal some slack in a strong labor market, tomorrow morning's monthly jobs report "will have the final say," says Chris Larkin, managing director of trading and investing at E*TRADE from Morgan Stanley ( MS ). "Investors will be looking for a 'Goldilocks' number that won't give the Fed any reason to delay rate cuts, but also doesn't suggest the labor market is taking a serious downturn."