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Mid-Day Recap: Weak Labor & Services Data Push Down Equities
Markets opened lower Wednesday after two labor reports before the bell were softer than expected, and when another report on the services sector failed to meet the consensus forecast at 10 am, and the sell-off extended. rnrnThe S&P 500, which crossed the 1,000 mark for the first time since October on Monday, has shrunk 0.81% to 997 in the first half of trading today. Worse, the Nasdaq shed 1.43% to 1,982, and the Dow lost 0.91% to 9,235.
ISM Services Index Disappoints, Labor Component Falls
Unlike the ISM Manufacturing Index, which on Monday surpassed expectations as it jumped more than 4 points, led by expansionary trends in new orders and production posting, the ISM Non-Manufacturing Index performed worse in July than in June.rnrnThe sentiment-based index of the services, construction, and financial industries nudged down 0.6 points to 46.4 in July, as business activity, new orders, and employment were all lower. The consensus forecast was 48.2.
ADP Employment Survey: 371,000 Jobs Lost In July. Looking Ahead to Non-Farm Payrolls
The ADP private employment survey suggests that 371k private jobs were lost in July, a harsher figure than the -300k median forecast, but an improvement from the -463k print in June.rnrn“Despite recent indications that overall economic activity is stabilizing, employment, which usually trails overall economic activity, is likely to decline for at least several more months, albeit at a diminishing rate,†noted ADP spokesman Joel Prakken.
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