Thursday September 1st

1-09-2016

Wall Street set for pause after ADP report

U.S. stock index futures indicated a flat-to-lower open Wednesday following the release of the ADP's private sector payroll report. Job creation at the company level rose about in line with expectations in August, despite weakness in manufacturing and construction, according to the latest report from ADP and Moody's Analytics. Companies added 177,000 positions for the month, just above Wall Street expectations for 175,000. The repor is seen as a kind of warm-up to government employment figures with August's nonfarm numbers expected this Friday. The data have taken on greater importance since several Federal Reserve members opened the door to hiking interest rates in September at the Jackson Hole symposium last week. Economists expect ADP to report 175,000 private sector payrolls were added in August. ADP payrolls totaled 179,000 last month, while the government report was 255,000. Economists expect to see 180,000 jobs in the government report Friday. Investors will also receive pending home sales data at 10 a.m. ET and a Chicago PMI Index at 9:45 a.m. ET. On Tuesday, U.S. stocks closed lower with utilities falling 1 percent, as investors analyzed strong consumer data while keeping an eye on the Federal Reserve ahead of Friday's jobs report. Sentiment was weak in Europe and Asia on the last trading day of the month. Japanese shares gained on the back of a weaker yen on Wednesday, but traders were mainly focusing on the key August U.S. nonfarm payroll data due Friday. The Nikkei 225 ended up 0.97 percent, or 162.04 points, at 16,887.40, while the Topix added 1.27 percent, or 16.73 points, to 1329.54. The Japanese yen traded at 103.17 against the greenback as of 2:37 p.m. HK/SIN; earlier in the session, the pair climbed as high as 103.24, its highest in around a month. Other major markets in the region struggled. South Korea's Kospi index ended down 0.25 percent, or 5.09 points, at 2034.65. In Australia, the ASX 200 shed 0.83 percent, or 45.29 points, to 5433, with most sectors trading lower. The energy and materials sectors were down 1.05 and 2.40 percent, respectively, on the back of lower commodity prices overnight. Hong Kong's Hang Seng index closed down 0.17 percent, or 39.23 points, at 22,976.88. Chinese mainland markets were modestly higher, with the Shanghai composite up 0.35 percent, or 10.81 points, at 3085.48, and the Shenzhen composite gaining 0.22 percent, or 4.52 points, at 2032.87. Crude oil prices slid on Wednesday, pressured by a strong U.S. dollar and high stocks of physical oil, though prices remained on track for a monthly gain of more than 10 percent. Brent crude oil futures were trading at $47.74 per barrel at 8:55 a.m. ET (1255 GMT), down 63 cents from the previous close, while U.S. West Texas Intermediate (WTI) crude futures were down 49 cents at $45.86. Gold edged higher on Wednesday as the dollar softened, but remained on course to snap two months of gains in August on mounting speculation the Federal Reserve could raise interest rates sooner rather than later. Spot gold was $1,311.97 an ounce, up 0.1 percent, having slipped 1 percent in the previous session to touch a two-month low of $1,308.65. The metal is heading for a 2.8 percent drop in August. U.S. gold futures were down $1.70 at $1,314.80.