AMTD TD Ameritrade Holding Corporation

By Mark DeCambre, MarketWatch , Andrea Riquier

Dow and S&P 500 both now below 100-day moving averages

U.S. stocks opened lower on Wednesday after a reading of private-sector employment affirmed that hiring was slowing. That report came after Wall Street was rattled Tuesday by the worst reading on American factories since 2009, along with data showing global manufacturing has now shrunk for the fifth month in a row.

What did major indexes do?

The Dow Jones Industrial Average opened 180 points lower, or 0.7%, to open at 26,395 while the S&P 500 index fell about 20 points or 0.7%, opening at 2,920. The Nasdaq lost 62 points, 0.8% at the open, touching 7,847.

The Dow and S&P 500 have now both broken below their 100-day moving averages.

On Tuesday, the Dow lost 344 points, or 1.3%, to finish 26,573.04, the S&P 500 fell 37 points, or 1.2%, to end at 2,940.25. The Nasdaq Composite Index retreated 91 points, or 1.1%, to close at 7,908.68. The small-capitalization Russell 2000 index saw a steeper drop, losing 1.9% to 1,493.43. The S&P 500 closed below its 50-day moving average for the first time since Sept. 4.

What's driving the market?

A private-sector employment report (http://www.marketwatch.com/story/adp-says-135000-private-sector-jobs-created-in-september-as-hiring-continues-to-slow-2019-10-02) from Automatic Data Processing showed that a modest 135,000 jobs were created in September, another sign that hiring is slowing along with the broader U.S. economy. That missed the Econoday consensus forecast of 152,000 jobs. The average monthly job growth for the past three months also fell to 145,000 from 214,000 for the same time period last year.

That followed a Tuesday release of the JPMorgan IHS global manufacturing index (https://www.markiteconomics.com/Public/Home/PressRelease/6d5ffb41584d4c08a54706d85d3580b3)for September, which remained below 50, signalling contraction, for a fifth straight month.

"Bottom line: as expected. Equity futures were already lower ahead of these data," said Scott Brown, chief economist for Raymond James, after the ADP report was released.

The ADP payrolls report is published ahead of the more closely followed U.S. Labor Department's nonfarm-payroll report due on Friday.

Signs of weakness in the U.S. economy may prompt the Federal Reserve to further lower interest rates at its late October meeting, after two quarter percentage point cuts in back-to-back central-bank policy meetings, market participants said.

Which stocks are in focus?

Johnson & Johnson(JNJ) shares rose nearly 3% after the company cut a deal to avoid an upcoming opioid litigation trial.

Shares of pharmaceutical company Savara Inc.(SVRA) tumbled 47% in morning trading after the company said the U.S. Food and Drug Administration had found its application for a new medication insufficient.

Discount-broker stocks continued to fall after the Tuesday announcement by Charles Schwab Corp.(SCHW) that it would cut most trading commissions to zero (http://www.marketwatch.com/story/can-it-get-any-cheaper-to-be-an-investor-2019-10-01). TD Ameritrade Holdings Corp.(AMTD) lost 3% in early-morning trading.

How did other markets trade?

The yield on the 10-year U.S. Treasury note was down nearly 4 basis points to 1.61% on Wednesday morning.

In commodities markets, West Texas Intermediate crude-oil for November delivery was down 13 cents, about 0.2%, to $53.53 a barrel on the New York Mercantile Exchange.

Gold for December delivery jumped $13.10, nearly 0.9%, to reach $1,502.50 an ounce.

In Asia, Chinese equity benchmarks were closed in observance of the 70th anniversary of Communist rule. Japan's Nikkei 225 meanwhile, fell 0.5%, wiping out a similar loss from Monday. European stocks traded lower, with the Stoxx Europe 600 down 1.6%.

(END) Dow Jones Newswires

October 02, 2019 09:53 ET (13:53 GMT)

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