Stocks May Open Lower On Disappointing Jobs Data - U.S. Commentary

(RTTNews) - Stocks may come under pressure in early trading on Wednesday, extending the pullback seen in the previous session. The major index futures are currently pointing to a lower open for the markets, with the Dow futures down by 46 points.

Disappointing jobs data may weigh on the markets, as payroll processor ADP released a report showing a continued slowdown in the pace of private sector job growth in the month of March.

ADP said private sector employment climbed by 189,000 jobs in March following a slightly upwardly revised increase of 214,000 jobs in February.

Economists had expected an increase of about 230,000 jobs compared to the addition of 212,000 jobs originally reported for the previous month.

With the continued slowdown, the pace of private sector job growth came in below 200,000 for the first time since January of last year.

Mark Zandi, chief economist of Moody's Analytics, said, "Job growth took a step back in March. The fallout from the collapse in oil prices and surge in value of the dollar is hitting the job market."

"Despite the slowdown, underlying job growth remains strong enough to reduce labor market slack," Zandi added.

Not long after the open, trading could be impacted by the release of a separate report from the Institute for Supply Management on national manufacturing activity.

Economists expect the ISM's manufacturing index to edge down to 52.5 in March from 52.9 in February, indicating a modest slowdown in the pace of growth in the sector.

The Commerce Department is also due to release its report on construction spending in February, with spending expected to dip by 0.1 percent.

Among individual stocks, shares of Macerich (MAC) are likely to come under pressure after Simon Property (SPG) withdrew its offer to acquire the rival mall operator for $95.50 per share.

Agriculture products company Monsanto (MON) could also see early weakness after reporting second quarter earnings that came in below analyst estimates and providing disappointing guidance.

Meanwhile, traders are also likely to keep an eye on shares of GoDaddy (GDDY) as the web hosting company makes its debut after pricing its initial public offering at $20 per share.

After coming under pressure early in the session, stocks saw some further downside over the course of the trading day on Tuesday. The losses on the day partly offset the strong upward move that was seen during trading on Monday.

The major averages ended the session near their worst levels of the day. The Dow tumbled 200.19 points or 1.1 percent to 17,776.12, the Nasdaq slid 46.56 points or 0.9 percent to 4,900.88 and the S&P 500 dropped 18.35 points or 0.9 percent to 2,067.89.

In overseas trading, stock markets across the Asia-Pacific region turned in another mixed performance during trading on Wednesday. Japan's Nikkei 225 Index dropped by 0.9 percent, while Hong Kong's Hang Seng Index advanced by 0.7 percent.

Meanwhile, the major European markets have all moved to the upside on the day. While the French CAC 40 Index has jumped by 1 percent, the U.K.'s FTSE 100 Index and the German DAX Index are up by 0.7 percent and 0.6 percent, respectively.

In commodities trading, crude oil futures are rising $0.24 to $47.84 a barrel after falling $1.08 to $47.60 a barrel on Tuesday. Meanwhile, an ounce of gold is currently trading at $1,192.70, up $9.50 from the previous session's close of $1,183.20. On Tuesday, gold declined $2.10.

On the currency front, the U.S. dollar is trading at 119.91 yen compared to the 120.13 yen it fetched at the close of New York trading on Tuesday. Against the euro, the dollar is valued at $1.0776 compared to yesterday's $1.0835.