U.S. Stocks May Experience Choppy Trading Early On

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.

Traders may take a step back from the markets following the advance seen to start the first full trading week of the new year.

However, it is worth noting that the futures were pointing to a roughly flat open on Tuesday before the Dow and the S&P 500 both climbed to new record closing highs over the course of the session.

The futures remained little changed after payroll processor ADP released a report showing private sector employment in the U.S. increased by slightly less than expected in the month of December.

ADP said private sector employment rose by 41,000 jobs in December after falling by a revised 29,000 jobs in November.

Economists had expected private sector employment to climb by 47,000 jobs compared to the loss of 32,000 jobs originally reported for the previous month.

“Small establishments recovered from November job losses with positive end-of-year hiring, even as large employers pulled back,” said ADP chief economist Dr. Nela Richardson.

After turning in a strong performance to kick off the first full trading week of the new year, stocks saw further upside during trading on Tuesday. With the continued upward move, the Dow and the S&P 500 reached new record closing highs.

The major averages ended the day just off their highs of the session. The Dow jumped 484.90 points or 1.0 percent to 49,462.08, the Nasdaq climbed 151.35 points or 0.7 percent to 23,547.17 and the S&P 500 rose 42.77 points or 0.6 percent to 6,944.82.

The Dow benefitted from a sharp increase by shares of Amazon (AMZN), with the online retail giant surging by 3.4 percent.

Amazon jumped to a new record closing high after announcing it is rolling out Alexa.com to Alexa+ Early Access customers in what is seen as an effort to more directly compete with ChatGPT and Gemini.

Strong gains by Amgen (AMZN), Salesforce (CRM) and IBM Corp. (IBM) also contributed to the jump by the blue chip index.

The continued advance by the broader markets came despite a lack of major catalysts, as traders look ahead to the release of several key U.S. economic reports in the coming days.

The highlight of the week is likely to be the release of the Labor Department’s closely watched monthly jobs report on Friday.

The data could impact the outlook for interest rates ahead of the Federal Reserve’s next monetary policy meeting later this month.

While the Fed is likely to leave rates unchanged at its January 27-28 meeting, the central bank is widely expected to cut rates by at least another quarter point in the coming months.

Computer hardware stocks turned in some of the market’s best performances on the day, with the NYSE Arca Computer Hardware Index soaring by 4.3 percent.

A sharp increase by the price of gold also contributed to substantial strength among gold stocks, as reflected by the 4.1 percent surge by the NYSE Arca Gold Bugs Index.

Biotechnology stocks also saw considerable strength on the day, resulting in a 3.0 percent jump by the NSYE Arca Biotechnology Index.

Semiconductor, retail and healthcare stocks also showed notable moves to the upside, while significant weakness was visible among energy stocks amid a pullback by the price of crude oil.

Commodity, Currency Markets

Crude oil futures are falling $0.36 to $56.77 a barrel after tumbling $1.19 to $57.13 a barrel on Tuesday. Meanwhile, an ounce of gold is trading at $4,452.10, down $44 compared to the previous session’s close of $4,496.10. On Tuesday, gold jumped $44.60.

On the currency front, the U.S. dollar is trading at 156.38 yen compared to the 156.62 yen it fetched at the close of New York trading on Tuesday. Against the euro, the dollar is valued at $1.1692 compared to yesterday’s $1.1687.

Asia

Asian stocks ended mixed on Wednesday as tensions between China and Japan escalated, and weak U.S. data spurred hopes for more rate cuts.

Federal Reserve Governor Stephen Miran has called for aggressive rate cuts exceeding 100 basis points in 2026, arguing that current tight monetary policy is dragging down the world’s largest economy.

The dollar moved in a tight range as investors looked ahead to the release of some key U.S. economic readings this week that could set the tone for the Federal Reserve’s rate outlook.

Gold dropped nearly 1 percent on profit taking after climbing to a more than one-week high earlier, driven by escalating geopolitical tensions.

Oil extended steep overnight losses after the United States and Venezuela reached an agreement allowing the export of up to $2 billion worth of Venezuelan crude oil to U.S. ports.

U.S. President Donald Trump said between 30 million and 50 million barrels of oil would be sold to the U.S. at market prices, with proceeds overseen by U.S. Energy Secretary Chris Wright.

China’s Shanghai Composite Index finished marginally higher at 4,085.77 after a choppy session amid tensions with Japan and optimism over artificial intelligence.

Hong Kong’s Hang Seng Index fell 0.9 percent to 26,458.95, with tech stocks coming under selling pressure.

Amid rising tensions over Taiwan, China’s commerce ministry said that exports of products with potential military use to Japan would be banned immediately.

Japanese markets fell sharply from a record high hit the precious day as rising geopolitical tensions prompted traders to book profits.

Japan has lodged a strong protest against Beijing’s trading curbs on dual-use goods that threaten to impact more than 40 percent of Chinese exports to Japan.

The export control list features more than 800 items, ranging from chemicals, electronics and sensors to equipment and technologies used in shipping and aerospace.

The Nikkei 225 Index slumped 1.1 percent to 51,961.98, while the broader Topix Index settled 0.8 percent lower at 3,511.34.

Uniqlo brand owner Fast Retailing lost 2.7 percent and chip-testing equipment maker Advantest slumped 4.4 percent.

Seoul stocks closed higher to set a fresh record high, with tech, shipbuilding and auto stocks pacing the gainers. The Kospi climbed 0.6 percent to 4,551.06.

Hyundai Motor soared 13.8 percent and its smaller affiliate Kia Corp .climbed 5.6 percent after Hyundai-owned Boston Dynamics publicly demonstrated its humanoid robot Atlas for the first time Monday at this year’s CES tech show.

Australian markets eked out modest gains after data showed consumer prices in the country rose by less than forecast in November. However, the trimmed mean measure of core inflation suggested some sticky inflationary pressures.

The benchmark S&P/ASX 200 Index edged up by 0.2 percent to 8,695.60 as strong commodity prices boosted mining stocks. The broader All Ordinaries Index closed 0.2 percent higher at 9.018.

Across the Tasman, New Zealand’s benchmark S&P/NZX-50 Index rose 0.4 percent to 13,715.02, marking a record closing high.

Europe

After moving mostly higher over the course of the previous session, European stocks are turning in a mixed performance during trading on Wednesday.

While the U.K.’s FTSE 100 Index is down by 0.6 percent, the French CAC 40 Index is just above the unchanged line and the German DAX Index is up by 0.7 percent.

Earlier in the day, data showed that the number of people out of work in Germany rose less than expected in December.

German retail sales fell 0.6 percent month-on-month in November 2025, missing expectations for a 0.2 percent increase.

In corporate news, Sweden’s Skanska has rallied after selling a self-developed residential and hotel project in Copenhagen.

LEG Immobilien has also jumped as the German real estate company announced the successful sale of around 900 residential units totaling 63 million euros in the fourth quarter of 2025.

Wind turbine maker Nordex has also surged after it was selected to deliver more than 414 MW of its machines for 15 projects across Europe.

On the other hand, GSK has moved to the downside despite announcing positive phase III trial results for bepirovirsen.

U.S. Economic News

Private sector employment in the U.S. increased by slightly less than expected in the month of December, according to a report released by payroll processor ADP on Wednesday.

ADP said private sector employment rose by 41,000 jobs in December after falling by a revised 29,000 jobs in November.

Economists had expected private sector employment to climb by 47,000 jobs compared to the loss of 32,000 jobs originally reported for the previous month.

“Small establishments recovered from November job losses with positive end-of-year hiring, even as large employers pulled back,” said ADP chief economist Dr. Nela Richardson.

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

The services PMI is expected to edge down to 52.3 in December after inching up to 52.6 in November, although a reading above 50 would still indicate growth.

The Labor Department is also due to release its report on job openings in the month of November at 10 am ET. Job openings are expected to slip to 7.65 million in November from 7.67 million in October.

Also at 10 am ET, the Commerce Department is scheduled to release its report on new orders for manufactured goods in the month of October. Factory orders are expected to slump by 1.2 percent.

The Energy Information Administration is due to release its report on oil inventories in the week ended January 2nd at 10 :30 am ET.

Crude oil inventories are expected to increase by 1.1 million barrels after falling by 1.9 million barrels in the previous week.

At 4:10 pm ET, Federal Reserve Vice Chair for Supervision Michelle Bowman scheduled to speak on “Modernizing Supervision and Regulation” at the California Bankers Association: 2026 Bank Presidents Seminar.