Stock futures showed mixed movement on Wednesday after ADP’s latest report indicated a slowdown in private sector hiring for February.
Private sector employment rose by just 77,000 jobs, significantly below the upwardly revised 186,000 jobs in January and falling short of economists’ expectations of 142,500 jobs, according to a FactSet survey.
In response to the report, Dow futures edged lower, S&P 500 futures remained flat, and Nasdaq 100 futures rose by 0.1%. Prior to the release of the data, all three major indices had been trading slightly higher.
Meanwhile, bond yields dropped, with the 2-year Treasury note yielding 3.93% and the 10-year yield at 4.22%.
The ADP report comes ahead of Friday’s more closely watched update on nonfarm payrolls from the Labor Department, raising concerns among Wall Street analysts about the economy’s trajectory. Recent sentiment surveys have shown a decline, heightening fears about potential economic weakness.
Andrew Brenner, head of international fixed income at NatAlliance Securities, suggested that Friday’s employment report could be unpredictable. He noted that past data releases had often shown a rally in rates ahead of the reports, but expressed caution regarding the potential for a higher-than-expected figure on Friday. He also mentioned that employment numbers in April and May might be weaker than expected, further complicating the outlook.
