Wall Street Today | Fed's Beige Book Shows Slower Activity Growth and Hiring in Peak Summer

Growth in the US economy and jobs market slowed in July and August, and many businesses expect wage increases to ease broadly in the near term, the Federal Reserve said in its Beige Book survey of regional business contacts.

"Contacts from most districts indicated economic growth was modest," the Fed said Wednesday in the report, published two weeks before each meeting of the policy-setting Federal Open Market Committee.

US service sector activity rose to a six-month high in August, bolstered by a pickup in new orders and hiring, Bloomberg reported.

The Institute for Supply Management's services index increased almost 2 points to 54.5, data showed Wednesday. Readings above 50 indicate expansion, and the figure topped all estimates in a Bloomberg survey of economists.

Developing-world currencies and stocks weakened as renewed dollar strength and elevated oil prices hurt sentiment for riskier emerging assets.

MSCI's gauge of developing equities fell as much as 0.5%, extending its decline to a second day, while the currencies dropped to the lowest in over two weeks. Volatility across emerging markets have prompted Barclays PLC to predict a "wild ride" in local markets.

The global benchmark, Brent, settled above $90 on Thursday, the highest since November. Adding to bullish sentiment, Saudi Arabia lifted official selling prices for its flagship Arab Light crude to Asia to a 10-month high, a signal of its confidence in demand.

Still, crude is flashing warnings that it is overbought on a 14-day Relative Strength Index basis, raising the risk of a pullback.