(As of 7:05 am PST)
US stocks are on the rise
early Wednesday looking to snap a three day losing streak. It’s a busy data day with the
most notable report coming from payroll processor, Automatic Data Processing
(ADP), which showed private sector job growth slowing in July with only 185,000
jobs added – well below the 220,000 forecasted.
The softer-than-expected reading has some investors speculating that
Friday’s non-farm payrolls report could also show signs of weakness, which may
cause the Fed to consider pushing out their rate hike timeline. Though the ADP
report often is a poor guide to the more reliable Labor Dept. report released
Friday, traders will often look to it for clues on the labor market and I think
we may be seeing the bid up in stocks today as a result of the weakness in the
ADP. Corporate earnings are also contributing to today’s rise in stocks with reports
from Priceline and First Solar beating expectations. Shares of Apple Inc. are
also recovering today after a recent skid has thrust the world’s largest
company back into the headlines. In Asia, stocks finished Wednesday’s session
mixed despite positive data out of China’s services sector. European stocks
were broadly higher. Gold is down slightly today while oil is up 1%. If today’s
early rally is based solely on the ADP report expect it to fade as the day
wears on.
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