U.S. Stocks May Give Back Ground In Early Trading
(RTTNews) – Stocks managed to finish yesterday’s volatile session mostly higher but may give back some ground in early trading on Wednesday. The major index futures are currently pointing to a lower open for the markets, with the Dow futures down by 104 points.
Renewed concerns about the pace of U.S. economic growth may generate early selling pressure after payroll processor ADP released a report showing private sector employment increased by much less than expected in the month of July.
ADP said private sector employment rose by 330,000 jobs in July after surging by a downwardly revised 680,000 jobs in June.
Economists had expected private sector employment to spike by 695,000 jobs compared to the jump of 692,000 jobs originally reported for the previous month.
On Friday, the Labor Department is scheduled to release its more closely watched monthly jobs report, which includes both public and private sector jobs.
Economists currently expect the report to show employment surged up by 880,000 jobs in July after spiking by 850,000 jobs in June. The unemployment rate is expected to dip to 5.7 percent from 5.9 percent.
A notable drop by shares of General Motors (GM) may also weigh on Wall Street, with the auto giant slumping by 3.8 percent in pre-market trading.
The decline by GM comes after the company reported second quarter earnings missed analyst estimates, although the automaker still raised its full-year guidance.
Not long after the start of trading, the Institute for Supply Management is scheduled to release its report on service sector activity in the month of July.
The ISM’s services PMI is expected to inch up to 60.4 in July from 60.1 in June, with a reading above 50 indicating growth in the sector.
After seeing significant volatility early in the session, stocks moved mostly higher over the course of the trading day on Tuesday. With the upward move on the day, the S&P 500 ended the session at a new record closing high.
The major averages saw further upside going into the close, finishing the day at their best levels of the session. The Dow advanced 278.24 points or 0.8 percent to 35,116.40, the Nasdaq rose 80.23 points or 0.6 percent to 14,761.30 and the S&P 500 climbed 35.99 points or 0.8 percent to 4,423.15.
In overseas trading, stock markets across the Asia-Pacific region moved mostly higher on Wednesday, although Japan’s Nikkei 225 Index bucked the uptrend and dipped by 0.2 percent. China’s Shanghai Composite Index and Hong Kong’s Hang Seng Index both advanced by 0.9 percent.
The major European markets have also moved to the upside on the day. While the German DAX Index has risen by 0.6 percent, the French CAC 40 Index and the UK.’s FTSE 100 Index are both up by 0.3 percent.
In commodities trading, crude oil futures are slumping $1.23 to $69.33 a barrel after sliding $0.70 to $70.56 a barrel on Tuesday. Meanwhile, an ounce of gold is trading at $1,827.80, up $13.70 compared to the previous session’s close of $1,814.10. On Tuesday, gold fell $8.10.
On the currency front, the U.S. dollar is trading at 108.81 yen compared to the 109.04 yen it fetched at the close of New York trading on Tuesday. Against the euro, the dollar is trading at $1.1885 compared to yesterday’s $1.1864.
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