(As of 7:14 am pacific)
Stocks are down this morning despite positive economic
data as the market reopens after the 4th of July holiday. Strong US jobs data released today from ADP
indicates that the private sector added more jobs than economists forecasted in
June. The number of people filing for
unemployment benefits fell last week to its lowest level in over a month and a
half. A more accurate report of job
growth will come out tomorrow from the US Labor Department. Due out later today is a report from ISM on
US nonmanufacturing economic activity.
Despite the positive reports we’re seeing today out of the US, the market
seems to be shrugging them off and focusing on comments made by European
Central Bank President Mario Draghi.
After cutting the key lending rate of European banks to record lows, ECB
President Mario Draghi made several statements during a press conference that
weighed on investor confidence, overshadowing the stimulus measure and sending
stocks around the globe lower. Draghi
stated that economic growth in the euro region is weak and risks remain on the
downside. Other global central banks
took action today with China announcing a surprise interest rate cut for the
second time in a month, and the Bank of England expanding its quantitative
easing program. It wasn’t enough however
to overcome the gloomy outlook on Europe.
Oil and gold are both down while the dollar is mostly up. US treasury bonds are up, as interest rates
fell slightly. Volatility is trending up
and pointing to a choppy day.
