Stocks closed lower Thursday after strong jobs data got traders fretting once again about the specter of inflation.
With tomorrow’s monthly payrolls report on deck, today we learned weekly initial unemployment claims dropped below 400,000 for the first time since March 2020, an indication of a labor market on the mend. ADP’s own data puts May’s new-jobs number at 1 million, a figure well ahead of economists’ estimates.
Although April’s dismal numbers surprised and disappointed investors, the possibility of a red-hot May report tomorrow morning was enough to stoke inflation fears and, in turn, anxiety over interest rates.
“This morning’s economic data has rates moving higher,” writes Michael Reinking, senior market strategist at the New York Stock Exchange. “Just as the Street seemed to coalesce around the idea of another disappointing jobs number tomorrow, the ADP employment report came in at 1.5-times the Street estimate. Keep in mind, last month’s ADP report was also much stronger than the official data.”
As has been the pattern, big, pricey tech stocks such as Microsoft (MSFT, -0.6%), Amazon.com (AMZN, -1.5%) and Apple (AAPL, -1.2%) suffered the brunt of the selling. The more value-oriented Dow Jones Industrial Average slipped less than 0.1% to close at 34,577, while the broader S&P 500 dipped 0.4% to finish at 4,192. The tech-heavy Nasdaq Composite was the laggard of the major indexes, falling 1.0% to settle at 13,614.
- The Russell 2000 small-cap index fell 0.8% to close at 2,279.
- AMC Entertainment (AMC, -17.9%) swung wildly as it sold a total of 11.6 million shares at an average price of $50.85 a share. The offering, which raised $587.4 million in new equity, coincided with the stock falling almost 40% at one point during the session.
- Tesla (TSLA, -5.3%) tumbled on a report that the electric-vehicle maker’s orders in China fell by nearly half in May compared with April.
- U.S. crude oil futures rose 0.1% to $68.89 a barrel.
- Gold futures gained 1.9% to $1,873.20 an ounce.
- Bitcoin prices increased 2.3% to $38,623. (Bitcoin trades 24 hours a day; prices reported here are as of 4 p.m. each trading day.)