US close: Markets end lower as US and China edge towards agreement
Wall Street stocks finished as they started on Wednesday - in the red - as investors continued to keep an eye on any trade developments between the US and China.
Dow Jones I.A.
37,775.38
04:30 15/10/20
Nasdaq 100
17,394.31
12:15 18/04/24
The Dow Jones Industrial Average was down 0.52% at 25,673.46, the S&P 500 lost 0.65% to 2,771.45, and the Nasdaq 100 was 0.62% lower at 7,112.47.
At the open, the Dow lost 15 points after Bloomberg reported that Donald Trump was pressuring US negotiators to make a deal with China soon in the hopes of prompting a market rally.
“The US-China trade issue remains a core driver of market sentiment, with hopes of a breakthrough this month driving the bullish sentiment throughout US stocks in particular,” said Joshua Mahony, senior market analyst at IG.
“However, with this current lull in US-China trade talks, we are starting to see some doubt creep in as we look for new drivers.
“Fortunately, we see the economic calendar step up from the US perspective, with today’s ADP payrolls figure providing the important precursor to Fridays' headline job report.”
On the data front, the US jobs market cooled more rapidly than expected last month, but from a much higher base of comparison and in any case economists were continuing to predict steady demand for labour.
According to consultancy ADP, monthly private-sector payrolls grew by 183,000 in February, versus an upwardly revised gain of 300,000 for January.
Economists had anticipated an increase of 189,000 after an initially estimated jump of 213,000 for the previous month.
Medium-sized firms accounted for most of the hiring, adding 95,000 people to their payrolls, followed by a rise of 77,000 among large corporations and a gain of just 12,000 among small businesses.
Elsewhere, America's total trade deficit jumped at the end of 2018 as the shortfall in its trade on goods yawned wider.
The total trade deficit in goods and services increased by 18.8% in December to reach -$59.8bn, the Department of Commerce said, as export growth failed to keep up with that for imports.
Sales overseas fell by 1.9% versus the prior month, hitting $205.1bn even as purchases from abroad rose by 2.1% to $264.9bn.
A deteriorating balance in the country's trade in goods was the chief reason behind the worsening trade picture, as Americans continued to buy foreign-made computers and their accessories but sales of capital goods, including those of civilian aircraft, dropped.
Combined, those two trends helped push the nation's deficit in goods trade up by $9.0bn to $81.5bn.
In corporate news, Johnson & Johnson rose 0.23% after the Food and Drug Administration approved its Spravato nasal spray for depression late on Tuesday.
Elsewhere, shares in Abercrombie & Fitch soared 20.37% after the US clothing retailer posted a stronger-than-expected end to the year, and discount store Dollar Tree picked up 5.11% following news that its fourth-quarter sales had beat estimates.