Traders work on the floor of the New York Stock Exchange (NYSE) in New York City, U.S., May 2, 2016. REUTERS/Brendan McDermid
NEW YORK: Wall Street was lower on Wednesday after tepid US economic data and lackluster corporate results added to concerns about the health of the global economy.
The ADP private sector employment report showed hiring in April fell to its lowest levels in three years. The report acts as a precursor to the more comprehensive government nonfarm payrolls data, which is expected on Friday.
According to a Reuters survey of economists, nonfarm payrolls likely rose by 202,000 jobs in April after rising 215,000 in March. The unemployment rate is forecast holding steady at 5%.
In contrast, another set of data showed the vast US services sector expanded in April as new orders and employment accelerated, helping assuage some of the fears.
The US Federal Reserve, which held monetary policy steady last week, is keeping a keen eye on data, while leaving the door open for a rate hike in June.
A strengthening labor market is expected to influence its decision on future rate hikes, although traders are pricing in only one hike later this year.
World stocks added to losses after lacklustre manufacturing data from across the world, including China, triggered this week’s selling spree.
“This week the biggest drag on the market has been the cross-currency effects. We’ve seen some data which is a bit soft. There have been some underwhelming household earnings miss,” said Art Hogan, chief market strategist at Wunderlich Securities in New York.
“I don’t think the soft data is really going to concern the Fed as long as we see the jobs number in and around 200,000.”
At 11:09am ET (1509 GMT) the Dow Jones industrial average was down 62.22 points, or 0.35%, at 17,688.69, the S&P 500 was down 10.02 points, or 0.49%, at 2,053.35 and the Nasdaq Composite was down 24.78 points, or 0.52%, at 4,738.44.
Seven of the 10 major S&P sectors were lower, with the materials index’s 1.11% loss leading the decliners.
Shares of Priceline fell 10.2% to US$1,216.07 after the online travel services company’s forecast fell short of expectations.
Time Warner Inc was up 3.6% at US$76.32 after the owner of CNN and Cartoon Network reported a higher-than-expected rise in quarterly revenue.
Zillow jumped 13.5% to US$29.15, a day after the online real estate listings provider raised its full-year revenue outlook.
Intercontinental Exchange jumped 7% to US$257.99 after the US exchange operator said it did not intend to make a rival offer for London Stock Exchange Group.
Declining issues outnumbered advancing ones on the NYSE by 1,765 to 1,058. On the Nasdaq, 1,683 issues fell and 878 advanced.
The S&P 500 index showed 10 new 52-week high and five new lows, while the Nasdaq recorded 19 new highs and 39 new lows. - Reuters
Win a prize this Mother's Day by subscribing to our annual plan now! T&C applies.
