Wall Street opens in the red despite upbeat jobs figures
The main indices on Wall Street were on the back foot in early deals on Thursday despite better than expected US jobs numbers.
Shortly after the opening bell, the Dow Jones Industrial Average was down 0.58% at 34,399 while the S&P 500 dropped 0.61% to 4,182 and the Nasdaq fell 0.73% to 13,655.
The lower start came despite US weekly jobless claims falling below 400,000 for the first time since the start of the pandemic, according to the Department of Labor.
The number of Americans seeking unemployment benefits fell to 385,000 last week, slightly down on the forecasts of a figure of 387,000 and the lowest level since March 14 last year.
This compares to 405,000 the previous week, itself revised down by 1,000.
Earlier, the latest report from payrolls operator ADP showed that 978,000 new private sector jobs were created in May, up from 742,000 the previous month and beating expectations of a figure of 650,000.
Nela Richardson, ADP’s chief economist, said: “Private payrolls showed a marked improvement from recent months and the strongest gain since the early days of the recovery.
“While goods producers grew at a steady pace, it is service providers that accounted for the lion’s share of the gains, far outpacing the monthly average in the last six months. Companies of all sizes experienced an uptick in job growth, reflecting the improving nature of the pandemic and economy.”
What this signals for the non-farm payrolls on Friday, however, is anyone’s guess.
7:45am: Wall Street to start lower
Wall Street is expected to open lower as investors focus on the latest US jobs data due shortly.
Ahead of Friday’s widely watched non-farm payroll numbers – which came in well below forecasts last month with a rise of only 266,000 – come the private payroll figures for May from ADP. They are expected to show an increase of 750,000, up from 742,000 in April. However last time round the survey gave little guidance as to the official figure.
Also due are the weekly jobless claims, which are expected to fall from 406,000 to a new post-pandemic low of 387,000. Deutsche Bank for one however is expecting a rise to 435,000.
So with investors torn between welcoming an economic recovery and worrying about inflation, the Dow Jones Industrial Average is forecast to open 198 points or 0.6% lower while the S&P 500 is set to fall 0.69% and the Nasdaq Composite 0.94%.
Four things to watch for on Thursday:
- Companies in the earnings diary today include semiconductor and software firm Broadcom Inc (NASDAQ:AVGO), cybersecurity group Crowdstrike Holdings Inc (NASDAQ:CRWD) and athletic apparel retailer Lululemon Athletica Inc (NASDAQ:LULU)
- Investors may also be keeping an eye on AGMs from NVIDIA Corp (NASDAQ:NVDA) and Netflix Inc (NASDAQ:NFLX) which are due to kick off today
- Shares in cinema chain and Reddit memestock favourite AMC Entertainment Holdings Inc (NYSE:AMC) may also be in focus to see if the stock can continue its breakneck ascent
- On the macro front, aside from the jobs data there may also be interest in a number of US PMI readings
Story by ProactiveInvestors
Source: http://www.proactiveinvestors.com/companies/news/951322/wall-street-opens-in-the-red-despite-upbeat-jobs-figures-951322.html
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