U.S. stocks plunged Thursday as angst grew on Wall Street over key inflation data due out Friday.

The S&P 500 tumbled 2.4%, and the Dow Jones Industrial Average shed 640 points, or 1.9%. The Nasdaq Composite slid 2.8.%. The greater share of losses came in the final hour of trading as selling accelerated into the end of a downbeat session.

Investors are bracing for the Bureau of Labor Statistics’ latest Consumer Price Index (CPI) on Friday as they look for further clues on how aggressively the Federal Reserve will ramp up interest rates. May’s reading is projected to show inflation persisted in May. Consensus economists are looking for headline inflation to rise at an 8.3% annual rate for May — on par with April's print — and by 5.9% excluding food and energy prices.

Downturn also followed data on the labor market that disappointed before the open and confirmation from the European Central Bank of its intention to raise interest rates next month.

Weekly filings for unemployment insurance totaled 229,000 last week, the most since January, and a sign of potential stress building in the labor market. Ahead of this data, all three major indexes were pointing to gains north of 0.4% at the open.

Oil prices were retreated slightly but held above $120 per barrel, and the U.S. 10-year Treasury yield inched higher to 3.06%, north of the 3% level the 10-year breached earlier this week for the first time since early May.

Investors continue to look for clues on how the economy is faring amid tighter financial conditions and how aggressive the Federal Reserve rate hiking cycle may get before a potential pause.

The latest weekly jobless claims report follows strong May employment data last Friday that likely signaled to policymakers current labor market conditions can withstand further monetary tightening. Central bank officials have taken cues from the labor market on the tempo of rate increases as it fights inflation, with policy aimed to cool labor demand just enough not to push the jobless rate too high.