US open: Stocks mixed as ADP payrolls show biggest decline since 2023

(Sharecast News) - Wall Street trading got off to a mixed start on Wednesday, as investors weighed the prospect of a yearend rally and digested key jobs data ahead of the Federal Reserve's upcoming policy decision.

As of 1505 GMT, the Dow Jones Industrial Average was up 0.15% at 47,546.13, while the S&P 500 shed 0.05% to 6,825.85, and the Nasdaq Composite came out of the gate 0.31% softer at 23,341.52.

The Dow Jones opened 71.67 points higher on Wednesday, extending gains recorded in the previous session.

Investors continued to weigh the prospect of a yearend rally at the open on Wednesday, with December trading historically supportive for major indices after a weak November marked by profittaking in big name stocks. Traders were also looking ahead to the Federal Reserve's 10 December policy meeting, with corporate earnings optimism underpinning sentiment.

However, today's primary focus will set to be November's non-farm payrolls figures from ADP, which revealed US private employers cut 32,000 jobs in November, taking a bite out of October's upwardly revised 47,000 gain and missing estimates for an increase of 10,000. November's print marked the biggest decline in payrolls since March 2023, as 120,000 job cuts at small establishments offset growth of 51,000 and 39,000 at medium-sized and large companies, respectively.

Among sectors, declines were seen in manufacturing, professional/business services, information, construction and financial activities, while job gains were seen in education/health services, leisure/ hospitality, natural resources/mining and trade, transportation and utilities. Meanwhile, the report also showed that annual pay for job-stayers rose 4.4%, up from 4.5% in October, while job-changers saw pay rise 6.3%, versus 6.7% in the prior month.

November's ADP report will likely have greater importance than usual, given the absence of Friday's official jobs report.

Elsewhere on the macro front, mortgage applications fell by 1.40% in the week ended 28 November, according to the Mortgage Bankers Association, more than reversing the prior week's 0.2% increase despite an eight basis point reduction in benchmark mortgage rates. Applications to refinance a mortgage fell 4.4% week-on-week, while applications to purchase a home rose 2.5%.

On another note, the Labor Department revealed that US imports and exports were both came flat in September. Both import and export prices flatlined following downwardly revised 0.1% upticks in August.

Still on data, capacity utilisation held steady at 75.9% in September, according to the Federal Reserve, matching August's revised reading but falling short of market expectations of 77.3%, while industrial production increased 1.60% month-on-month in September.

Finally, the S&P Global services purchasing managers index decreased to 54.1 in November, down from 54.8 in October and missing preliminary estimates of 55, while the Institute for Supply Management's services PMI increased to 52.60 last month, up from 52.40 in October.

In the corporate space, discount retailer Dollar Tree hiked its full-year profit guidance on Wednesday after beating quarterly expectations on both the top and bottom lines, while Macy's also raised forecasts after it said sales had hit their highest level in more than three years.

Still to come, Salesforce will issue its latest quarterly earnings after the close.

Reporting by Iain Gilbert at Sharecast.com

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Vertex Pharmaceuticals Inc. (VRTX) $453.36 4.66%

J.B. Hunt Transport Services Inc. (JBHT) $190.44 2.54%

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