The major U.S. index futures are currently pointing to a roughly flat open on Wednesday, with stocks likely to show a lack of direction following the upward move seen over the two previous sessions.

The futures had been pointing to a higher open on Wall Street but gave back ground following the release of a report from payroll processor ADP showing weaker than expected private sector job growth in the month of May.

ADP said private sector employment rose by 37,000 jobs in May after climbing by a downwardly revised 60,000 jobs in April.

Economists had expected private sector employment to jump by 115,000 jobs compared to the addition of 62,000 jobs originally reported for the previous month.

“After a strong start to the year, hiring is losing momentum,” said ADP chief economist Dr. Nela Richardson. “Pay growth, however, was little changed in May, holding at robust levels for both job-stayers and job-changers.”

In a post on Truth Social immediately after the report was released, President Donald Trump once again urged Federal Reserve Chair Jerome Powell to lower interest rates.

“ADP NUMBER OUT!!! ‘Too Late’ Powell must now LOWER THE RATE,” Trump said. “He is unbelievable!!!”

After recovering from early weakness to end Monday’s session mostly higher, stocks saw further upside during trading on Tuesday. With the continued upward move, the Nasdaq and the S&P 500 reached their best closing levels in over three months.

The major averages ended the day off their highs of the session but still firmly positive. The Nasdaq advanced 156.34 points or 0.8 percent to 19,398.96, the S&P 500 climbed 34.43 points or 0.6 percent to 5,970.37 and the Dow rose 214.16 points or 0.5 percent to 42,519.64.

The continued strength on Wall Street came following the release of a Labor Department report showing an unexpected increase by job openings in the U.S. in the month of April.

The Labor Department said job openings climbed to 7.391 million in April from an upwardly revised 7.200 million in March.

Economists had expected job openings to decrease to 7.100 million from the 7.192 million originally reported for the previous month.

The unexpected rebound by job openings partly reflected increases in job openings in the arts, entertainment, and recreation and mining and logging sectors.

“The higher-than-expected job openings number this morning is a good sign for the economy, as many were worried that the tariff uncertainty was weighing too heavily on businesses,” Chris Zaccarelli, Chief Investment Officer for Northlight Asset Management.

Meanwhile, traders continued to await further developments on the trade front a month ahead of the expiration of President Donald Trump’s 90-day tariff pause.

While tensions between the U.S. and China have seemingly risen in recent days, traders appear to remain generally optimistic about trade deals being reached.

“The 90-day pause on tariffs has just over a month before expiration, meaning the pressure is on countries to do deals with the Trump administration,” said Russ Mould, investment director at AJ Bell.

He added, “Reports suggest that Trump wants best offers on trade negotiations by Wednesday, perhaps to avoid any last-minute rush or stalemate situations.”

Oil service stocks turned in some of the market’s best performances on the day, resulting in a 4.2 percent spike by the Philadelphia Oil Service Index.

The rally by oil service stocks came as the price of crude oil extended Monday’s surge amid ongoing supply concerns.

Substantial strength was also visible among semiconductor stocks, as reflected by the 2.7 percent jump by the Philadelphia Semiconductor Index.

Computer hardware and networking stocks also saw considerable strength, contributing to the advance by the tech-heavy Nasdaq, while housing and banking stocks also moved notably higher.

Commodity, Currency Markets

Crude oil futures are falling $0.34 to $63.07 a barrel after jumping $0.89 to $63.41 a barrel on Tuesday. Meanwhile, an ounce of gold is trading at $3,375.50, down $1.60 compared to the previous session’s close of $3,377.10. On Tuesday, gold slid $20.10.

On the currency front, the U.S. dollar is trading at 143.57 yen compared to the 143.97 yen it fetched at the close of New York trading on Tuesday. Against the euro, the dollar is trading at $1.1402 compared to yesterday’s $1.1372.

Asia

Asian stocks advanced on Wednesday after new data showed the U.S. labor market is holding up in the face of tariff uncertainty.

An unexpected increase in U.S. job openings buoyed sentiment as the OECD warned uncertainty is stifling investment and confidence.

On the trade front, U.S. President Donald Trump today described Chinese President Xi Jinping as “extremely hard” to strike a deal with, even as the White House reiterated that the two leaders would talk “very soon.”

The Trump administration is actively monitoring China’s compliance with the Geneva trade agreement, White House Press Secretary Karoline Leavitt said.

Gold held steady near $3,360 an ounce in Asian trading as the dollar recovered some ground after dropping to six-week lows against a basket of currencies early this week. Oil prices were little changed after two days of gains.

China’s Shanghai Composite Index rose 0.4 percent to 3,376.20 and Hong Kong’s Hang Seng Index gained 0.6 percent to close at 23,654.03 on trade talk optimism and expectations of more Chinese stimulus.

Japanese markets snapped a three-day losing streak as the yen weakened, and investors hoped that U.S. President Trump’s tech blockade on China would spring a leak.

The Nikkei 225 Index jumped 0.8 percent to 37,747.45, while the broader Topix Index settled 0.5 percent higher at 2,785.13.

Advantest climbed 1.9 percent and Screen Holdings rallied 2.2 percent after AI rally frontrunner Nvidia led a chip-based market advance on Wall Street overnight. Toyota Industries Corp. plummeted almost 12 percent after a privatization deal.

Seoul stocks climbed to their highest levels in 10 months and the won strengthened as liberal presidential candidate Lee Jae-myung’s victory in a snap election resolved political uncertainty and spurred hopes of swift economic stimulus policies and market reforms.

The KOSPI soared 2.7 percent to 2,770.84, posting its biggest daily gain in nearly two months and closing at the highest level since August 1, 2024. Chipmaker SK Hynix topped the gainers list with a 4.8 percent surge.

Australian markets rose sharply as weak GDP data for the first quarter bolstered hopes of a July rate cut. Data showed GDP grew 0.2 percent in the first quarter, missing market forecasts on lower consumer and government spending,.

The benchmark S&P/ASX 200 Index jumped 0.9 percent to 8,541.80, led by banks and consumer stocks. The broader All Ordinaries Index closed 0.9 percent higher at 8,770.20.

Across the Tasman, New Zealand’s benchmark S&P/NZX-50 Index shot up 1.4 percent to 12,494.71.

Europe

European shares have moved higher on Wednesday as investors brace for a 25-basis point rate cut from the European Central Bank when it meets on Thursday.

In economic news, data showed the Eurozone’s services sector contracted modestly in May, with the final PMI Services reading falling to 49.7 from April’s 50.1. The U.K. services PMI was finalized at 50.9, up from April’s 27-month low of 49.0.

The French CAC 40 Index is up by 0.6 percent, the German DAX Index is up by 0.4 percent and the U.K.’s FTSE 100 Index is up by 0.2 percent.

Airbus shares have surged after Bloomberg News reported that China is considering placing an order for hundreds of Airbus SE aircraft as soon as next month.

Royal Philips has also jumped as the health technology company unveiled plans to repurchase up to 6 million shares to meet certain obligations arising from long-term incentive plans.

WH Smith has also rallied. The company maintained its full-year outlook after reporting continued strong performance in its global travel retail business for the 13-week period ending May 31, 2025.

Meanwhile, discount retailer B&M European Value Retail has slumped after posting a mixed bag of results for the past year.

Property management firm Hammerson has also fallen after announcing its Chief Executive Officer, Rita-Rose Gagne, plans to retire in 2026.

U.S. Economic News

A report released by payroll processor ADP on Wednesday showed private sector employment in the U.S. increased by much less than expected in the month of May.

ADP said private sector employment rose by 37,000 jobs in May after climbing by a downwardly revised 60,000 jobs in April.

Economists had expected private sector employment to jump by 115,000 jobs compared to the addition of 62,000 jobs originally reported for the previous month.

At 10 am ET, the Institute for Supply Management is scheduled to release its report on service sector activity in the month of May.

The ISM’s services PMI is expected to inch up to 52.0 in May from 51.6 in April, with a reading above 50 indicating growth.

The Energy Information Administration is due to release its report on crude oil inventories in the week ended May 30th at 10:30 am ET.

At 2 pm ET, the Federal Reserve is scheduled to release its Beige Book, a compilation of anecdotal evidence on economic conditions in each of the twelve Fed districts.




U.S. Stocks May Lack Direction Following Disappointing Private Sector Jobs Data

2025-06-04 12:54:19

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