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05/06/24
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Wall Street Rises After Growth of ADP Private Payrolls Eases
On Wednesday Wall Street rose as weak labor market data increased hopes that the Fed would cut interest rates this year to support growth.
The NASDAQ Composite gained 120 points, or 0.7%, the S&P 500 climbed 18 points, or 0.3%, and the Dow Jones Industrial Average rose 85 points, or 0.2%.
According to data from payrolls processor ADP, private payrolls in May increased at a lower-than-expected rate, and companies added 152K workers during the month, dropping from a downwardly revised total of 188K in the previous month.
Economists had expected a gain of 173K jobs.
This data came a day after another report showed that job openings in April dropped to the lowest level in more than 3 years.
The numbers indicate a possible slowing in labor demand in the biggest economy in the world, a trend that may solidify expectations that the Fed will cut interest rates later in the year.
Traders will have an opportunity on Friday to evaluate the U.S. jobs picture further when the monthly nonfarm payrolls report is released.
This reading came after Monday’s weak purchasing managers index data and last week’s downgraded GDP print.
CME’s FedWatch Tool shows there is now about a 65% probability the Fed will cut rates by 0.25% in September.
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