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US open: Trading kicks off with modest gains despite weak jobs data

By Iain Gilbert

Date: Wednesday 03 Jul 2019

US open: Trading kicks off with modest gains despite weak jobs data

(Sharecast News) - Wall Street trading began on a positive note on Wednesday following the late rally seen during the previous session.
As of 1530 BST, the Dow Jones Industrial Average was ahead 0.29% at 26,864.02, while the S&P 500 moved 0.38% higher to 2,984.19 and the Nasdaq Composite started the session 0.41 firmer at 8,142.53.

The Dow opened 77.34 points higher on Wednesday, with all the major indices appearing set to repeat their solid showing from Tuesday, which saw the S&P 500 set yet another record close despite threats of new tariffs on European goods, which served to dampen much of the optimism seen following news of a possible trade deal between the US and China.

Global growth worries were also weighing on investors' minds after South Korea became the latest trade-reliant economy to slash its targets for economic growth and exports.

On the data front, the number of Americans filing for unemployment benefits fell a little more than expected during the previous week.

US initial jobless claims dropped by 8,000 from the previous week's revised level to 221,000, versus expectations for a decline to 223,000. The previous week's level was revised up by 2,000.

Still on jobs news, private sector employment in the US grew less than expected in June, according to data released on Wednesday by the ADP.

Employers added 102,000 jobs last month versus expectations for a 140,000 increase. Meanwhile, May's jobs total added was revised up from 27,000 to 41,000.

According to some analysts, the disappointing data went a ways to strengthening the Fed's case for lowering rates at its monetary policy meeting later in July.

Last month, the central bank opened the door to easing monetary policy by claiming it would "act as appropriate" to maintain the current rate of economic expansion.

Elsewhere, the Institute for Supply Management's non-manufacturing index for June fell to 55.1, its lowest reading since July 2017 - down from the 56.9 recorded in May and short of expectation for a reading of 55.9.

Three of the gauge's four components slipped, with that tracking employment dropping by more than it had in almost a year and a half and new orders declining to their lowest levels since December 2017.

Lastly, new orders for US-made goods fell for a second consecutive month in May, pointing to continued weakness in manufacturing.

Factory goods orders decreased 0.7%, weighed down by weak demand for transportation equipment, according to the Commerce Department.

Data for April was revised sharply down to show factory orders falling 1.2% instead of slipping 0.8% as previously reported.

In corporate news, Tesla shares surged 6.19% after it posted record quarterly revenues, while Symantec shares rocketed 14.57% in early trading on reports that the group was in buyout talks with Broadcom.

IT and support services company 3AM Technologies will post its most recent quarterly figures later in the day.

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