Wall St ends lower as investors weigh fresh employment data
By Noel Randewich and Amruta Khandekar
(Reuters) — U.S. stocks ended down on Wednesday, pulled lower by megacaps and energy shares as signs of a cooling jobs market reinforced expectations that the Federal Reserve could start cutting interest rates early next year.
The ADP National Employment report showed private payrolls increased by 103,000 jobs in November, below economists' expectation of 130,000. That provided fresh evidence of labor market weakness, a day after news of a drop in October job openings.
The latest employment data reinforced expectations the Fed's rate-hike campaign is cooling the economy.
«Right now, it's consistent with the overall trajectory of softening job growth, and so far that's not problematic because the economy is still humming along,» said Bill Merz, head of capital markets research at U.S. Bank Wealth Management in Minneapolis.
«What would be concerning is if that trend persists for too long, and it turns into large job losses.»
Declines in energy stocks weighed on the major indexes, with oil prices dropping 4% as a larger-than-expected rise in U.S. gasoline inventories exacerbated worries about fuel demand. [O/R]
Of the 11 S&P 500 sector indexes, eight declined, led by energy, down 1.64%, followed by a 0.93% loss in information technology.
Nvidia (NASDAQ:NVDA) fell 2.3%, while Microsoft (NASDAQ:MSFT) and Amazon (NASDAQ:AMZN) each lost more than 1%.
While the S&P 500 ended lower, advancing issues in the index outnumbered decliners by a 1.3-to-one ratio.
On Friday, the more comprehensive non-farm payrolls report for November will offer greater clarity on the state of the labor market.
Investors widely expect the Fed to hold rates steady at its meeting next week and potentially start
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