Despite recession fears and comments from the Federal Reserve Chair that the central bank is "strongly committed" to bringing down inflation with rate hikes for the foreseeable future, the stock market rose slightly.
Fed officials say they won't reverse rate hikes.
The S&P 500 was up 0.4%, while the tech-laden index was up 0.4%.
The stock market opened lower after the European Central Bank raised interest rates to fight inflation.
After Powell said at a Q&A session that the Fed will continue to raise rates until inflation comes down meaningfully, the markets fell, but soon recovered.
Powell said he and his colleagues are committed to bringing down consumer prices and will keep at it until the job is finished.
Ahead of the Fed's next policy meeting later this month, traders are expecting the central bank to raise rates by 75 basis points for a third consecutive time.
The weekly jobless claims fell to their lowest level since May in a sign that the labor market remains strong, which has led investors to bet on the Federal Reserve hiking interest rates more aggressively and for a longer period of time.
Goldman said in a note on Thursday that Powell and other Fed officials have implied that progress toward taming inflation has not been as uniform as they would like. Goldman predicts that the Fed will raise rates by 50 basis points in November and 25 basis points in December.
After markets rebounded on Wednesday, with the S&P 500 gaining 1.8%, stocks are struggling to hold onto their recent gains. As the summer rally from the market's low point in June now looks to have completely dissipated, stocks are looking to avoid a fourth straight week of losses. As the Fed hikes rates and tightens monetary policy, investors are worried about a possible recession. In his most previous public remarks at the Fed's annual Jackson Hole symposium in late August, Powell said the central bank will not "stop or pause" raising interest rates until inflation comes back down
The stock market fell nearly 200 points as investors braced for higher interest rates.
The price of oil hit a seven-month low.
The stock market had a third straight week of losses despite a solid jobs report.
The summer rally in the stock market has come to an end.
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