After seeing some strength in the previous session, stocks moved back to the downside at the start of trading on Wednesday. The major averages moved notably lower at the open but have not seen much follow-through on the downward move.
The major averages are off their lows for the young session but currently remain in the red. The Dow is down 54.79 points or 0.4 percent at 13,224.53, the Nasdaq is down 9.22 points or 0.3 percent at 3,041.22 and the S&P 500 is down 7.93 points or 0.6 percent at 1,397.89.
The initial weakness on Wall Street came on the heels of the release of a report from payroll processor Automatic Data Processing, Inc. (ADP) showing weaker than expected private sector job growth in the month of April.
ADP said that private sector employment increased by 119,000 jobs in April following a downwardly revised increase of 201,000 jobs in March. Economists had expected an increase of about 183,000 jobs compared to the addition of 209,000 jobs originally reported for the previous month.
The data has raised some concerns about Friday's more closely watched monthly employment report from the Labor Department, which includes government jobs.
Natural gas stocks are seeing considerable weakness in early trading, with the NYSE Arca Natural Gas Index down by 2.4 percent. Chesapeake Energy (CHK) has helped to lead the sector lower after reporting weaker than expected first quarter results.
Significant weakness is also visible among gold stocks, which are moving lower along with the price of the precious metal.
Brokerage, networking, and oil stocks are also seeing early weakness, while strength is visible among health insurance, trucking, and healthcare provider stocks.
Among individual stocks, shares of MasterCard (MA) are down by 1.9 percent even though the credit card giant reported better than expected first quarter results. The company's revelation of an increase in rebates and incentives may have raised concerns about future results.
Cable giant Comcast (CMCSA) is also trading lower despite reporting stronger than expected first quarter earnings growth.
Meanwhile, shares of Standard Microsystems (SMSC) have moved sharply higher on news that the company agreed to be acquired by Microchip Technology (MCHP) for about $829 million in cash.
Charming Shoppes (CHRS) is also posting a strong gain after the retailer agreed to be acquired by Ascena Retail Group (ASNA) for about $890 million in cash.
In overseas trading, stock markets across the Asia-Pacific region moved to the upside during trading on Wednesday. Japan's Nikkei 225 Index ended the day up by 0.3 percent, while Hong Kong's Hang Seng Index rose by 1 percent.
Meanwhile, the major European markets have turned mixed over the course of the trading day. While the French CAC 40 Index is up by 0.4 percent, the German DAX Index is down by 0.6 percent and the U.K.'s FTSE 100 Index is down by 0.9 percent.
In the bond market, treasuries are seeing strength on the day following the disappointing jobs data. As a result, the yield on the benchmark ten-year note, which moves opposite of its price, is down by 4.1 basis points at 1.915 percent.
by RTT Staff Writer
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