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Dow Closes Flat as Traders Await Jobs Friday for Direction

Stock MarketsJun 03, 2021 04:19PM ET
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© Reuters.

By Yasin Ebrahim

Investing.com – The Dow cut gains to end roughly unchanged Thursday as investors awaited the jobs report due Friday that could intensify bets on the Fed tapering bond purchases sooner rather later.      

The Dow Jones Industrial Average slipped 0.1%, or 23 points, but had been 265 points down intraday. The Nasdaq Composite slipped 1.03%, and the S&P 500 fell 0.3%.

Signs of a recovery in the jobs market continued to take shape as jobless claims and private job gains data came in better than expected ahead of the nonfarm payrolls report due Friday.

The Labor Department reported that 385,000 people filed for unemployment insurance, down 20,000 from the prior week's 405,000 and larger than the 15,000 decline economists had expected.

In a further sign of improvement in the labor market, the economy created 978,000 private jobs in May, well above economists forecast for a 650,000.

The services sector, meanwhile, continued to see a revival as the economy reopens, rising to a record levels.

The pickup in the recovery has stoked expectations the Federal Reserve could start talking about tapering at its next meeting on June 15. 

"A firmer employment report … could tip the scale for Powell to officially kick off the tapering discussion at the FOMC meeting in two weeks' time," Commerzbank (DE:CBKG) added.

The slew of positive data pushed economically-sensitive cyclical stocks, particularly in financials and energy, higher. 

Banking stocks were supported by increasing investor bets on a favorable backdrop for banks as the eventual Fed tightening will steepened the yield curve, boosting net interest margin.

Energy stocks were helped by a recovery in oil prices following a larger-than-expected draw in crude stockpiles.

U.S. crude inventories fell by 5.1 million barrels last week, compared with expectations for a decrease of 2.4 million barrels.

Tech, meanwhile, was a drag on the broader markets as the sector's recent revival appears to running out of steam.

Google-parent Alphabet (NASDAQ:GOOGL), Apple (NASDAQ:AAPL), Amazon.com (NASDAQ:AMZN), Microsoft (NASDAQ:MSFT) and Facebook (NASDAQ:FB) ended more than 1% lower.

Chip stocks, which have played a role in the bidding up tech in recent weeks, also faltered, down about 1%.

The Reddit meme mania faded somewhat, paced by an 18% decline in AMC Entertainment Holdings Inc (NYSE:AMC). The movie chain company struck an agreement to sell up to 11.6 million shares as it seeks to cash on its recent rally that seen its share price jumped more than 350% in the past month.

GameStop (NYSE:GME) slipped 9%, while BlackBerry (NYSE:BB) ended up 4%.

In other news, FireEye (NASDAQ:FEYE) slumped 18% after selling its products business to Symphony Technology for $1.2 billion as the cybersecurity firm seeks to focus efforts on its intelligence and frontline business.

Dow Closes Flat as Traders Await Jobs Friday for Direction
 

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Comments (5)
Antaux Rollins
Antaux Rollins Jun 03, 2021 8:09PM ET
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reddit mania shifted to WKHS. I like how easily they left that out.
Bellamy Fernades
Bellamy Fernades Jun 03, 2021 8:09PM ET
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yes
Stan Smith
Stan Smith Jun 03, 2021 7:19PM ET
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Russia's $186 Billion Sovereign Wealth Fund Dumps All Dollar Assets...maybe this is why stocks are flat. Not a peep in the news about this?
Jaroslaw Andrzejewski
Jaroslaw Andrzejewski Jun 03, 2021 5:49PM ET
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Javier Escamilla
Javier Escamilla Jun 03, 2021 4:59PM ET
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Lol did you just changed the title 3 times throught the day?
Jouni Matero
Jouni Jun 03, 2021 4:59PM ET
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They do that, a lot of times just depending on how market changes over the day. Being Totally wrong and laziness combined.
Sloppy Joe
Sloppy Joe Jun 03, 2021 4:53PM ET
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Any number does not matter in the Ponzi scheme
 
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