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U.S. stocks open lower after ADP miss; Dow Jones falls 0.2%

Published 02/05/2014, 09:38 AM
Updated 02/05/2014, 09:38 AM
Dow Jones opens 0.2% lower after ADP miss

Dow Jones opens 0.2% lower after ADP miss

Investing.com - U.S. stock markets were lower after the open on Wednesday, after data showed that U.S. non-farm private employment rose less-than-expected in January, fuelling concern over the labor market.

During early U.S. trade, the Dow Jones Industrial Average fell 0.2%, the S&P 500 shed 0.3%, while the Nasdaq Composite index declined 0.3%.

Before the bell, payroll processing firm ADP said non-farm private employment rose by a seasonally adjusted 175,000 last month, below expectations for an increase of 180,000.

While not viewed as a reliable guide for the government jobs report due on Friday, February 7, it does give guidance on private-sector hiring.

The ISM Institute is to publish data on service sector activity shortly after the open.

Investors will also watch speeches from Philadelphia Federal Reserve President Charles Plosser and Atlanta Fed President Dennis Lockhart later in the day.

In earnings news, Ralph Lauren saw shares jump 1.1% after the clothing retailer reported stronger-than-expected fiscal third quarter profit, as demand from North American department stores boosted sales.

Time Warner rose 0.5% after reporting better-than-expected fourth quarter earnings and revenue. The company authorized a 10% boost in quarterly dividend and announced a new USD5 billion share buyback program.

In corporate news, pharmaceutical giant Merck picked up 2.7% after the firm announced plans to work with Pfizer , Amgen and Incyte on a combination treatment for its top pipeline prospect, an immune system-based cancer drug.

Dow component 3M advanced 0.5% after the company announced a new USD12 billion stock buyback program.

CVS shares dropped 0.7% after the convenience store and pharmacy chain said it will pull cigarettes and tobacco products from its stores by October 1. The firm said the decision won't impact its 2014 earnings-per-share guidance, but pulling tobacco will cost the company USD2 billion in annual revenues.

Other stocks that will likely see active trading include, Twitter, Yelp and Walt Disney, which are all expected to release quarterly earnings after Wednesday’s closing bell.

Across the Atlantic, European stock markets were mildly higher, as encouraging euro zone private sector data for January offset a report showing a sharp fall in retail sales in the region in December.

The EURO STOXX 50 rose 0.1%, France’s CAC 40 added 0.3%, Germany's DAX inched up 0.1%, while Britain's FTSE 100 advanced 0.4%.

Asian stock markets ended mostly higher on Wednesday, with Japan’s Nikkei 225 Index bouncing off the previous session’s three-month low, as the global selloff that has shaken markets in recent weeks paused.

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