Stock futures turn negative ahead of labor data

Traders will be watching for the ADP report on private sector hiring

U.S. equity futures turned negative ahead of the Wednesday trading session on Wall Street.

The major futures indexes suggest a decline of 0.2% ahead of the release of the week's first labor-related report.

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The payroll processing firm ADP’s National Employment report for June will be release Wednesday morning.

Economists are looking for a gain of 600,000 private-sector jobs, almost 400,000 below May’s much larger-than-expected increase of 978,000, which marked the biggest addition since June 2020.

The biggest data release this week will be Friday’s U.S. jobs report for June. Economists expect it to show American employers created 675,000 more jobs than they cut, with the unemployment rate falling to 5.7%.

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After the market begins trading, the Institute for Supply Management is out with its Chicago Purchasing Managers’ index for June. The closely-watched gauge of Midwest business activity is anticipated to slip more than 5 points from May’s reading of 75.2, which was the highest in more than 47 years.

The National Association of Realtors will publish its index of pending home sales for May.  Economists anticipate a 0.8% month-over-month decline, an improvement from a surprise 4.4% drop in April when sales were clipped by record-low inventories.

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Shares were mostly higher in Asia on Wednesday despite new data showing factory activity slowed this month as virus outbreaks disrupted shipping at some Chinese ports.

Japan’s industrial output fell 5.9% in June from the month before while South Korean production fell 0.7%.

A key measure of Chinese factory activity, the purchasing managers index, remained just barely in a state of expansion.

Tokyo's Nikkei 225 index edged 0.1% lower, Hong Kong's Hang Seng index fell 0.6% and China's Shanghai Composite index added 0.5%.

In Europe, London's FTSE declined 0.5%, Germany's DAX fell 0.9% and France's CAC dropped 0.8%.

Ticker Security Last Change Change %
I:DJI DOW JONES AVERAGES 35116.4 +278.24 +0.80%
SP500 S&P 500 4423.15 +35.99 +0.82%
I:COMP NASDAQ COMPOSITE INDEX 14761.294551 +80.23 +0.55%

The S&P 500 inched up less than 0.1% to 4,291.80, adding to its all-time high set a day earlier. More stocks fell than rose within the index, but gains for tech companies made up for weakness for banks and utilities.

The Dow Jones Industrial Average also edged less than 0.1% higher, to 34,292.29. The Nasdaq composite added 0.2% to 14,528.33.

Stocks have set their recent records on optimism that the economy is strengthening and that the Federal Reserve will keep interest rates low for a while longer.

A report released Tuesday showed a measure of confidence among U.S. consumers is continuing to rise, beating economists’ expectations for a slight decline. That’s key for an economy made up mostly of spending by consumers.

A separate report showed that home prices across the country rose again in April, continuing their blistering pace.

With one day left in June, the market is getting ready to close out a strong first half of the year. The S&P 500 is on track for a gain of 14.3%, more than double its average for a full year, going back to the start of the millennium.

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In other trading, U.S. benchmark crude oil added 83 cents to $73.81 per barrel in electronic trading on the New York Mercantile Exchange. It gained 7 cents to $72.98 per barrel on Tuesday. Brent crude, the international standard, picked up 54 cents to $75.30 per barrel.

The Associated Press contributed to this report.