Palantir, one of the biggest gainers in the S&P 500 last year rising more than 340%, was down for a third straight day in premarket, losing more than 2%. Chipmaker Advanced Micro Devices shed about 2.2% after a downgrade by HSBC.
Data released Wednesday morning showed private-sector job creation in December eased more than expected, while wages grew at the slowest pace since July 2021, according to payment processing firm ADP. Investors are now turning to minutes from the Fed’s December meeting, slated for release at 2 p.m. ET.
Futures also appeared to take a leg down earlier after CNN reported, citing sources, that President-elect Donald Trump is considering declaring a national economic emergency to push through new tariffs.
Stocks are coming off a rough trading session, as major averages finished solidly in red following strong economic data showing greater-than-expected expansion in the U.S. services sector, per the Institute for Supply Management. The reading showed an increase in prices on month, fanning concerns around stubborn inflation and questions around this year’s trajectory of interest rate cuts from the Federal Reserve.
According to CME’s FedWatch tool, markets are currently pricing in a 95% chance of no reductions at the central bank’s meeting this month.
Bond yields, which have been climbing on bets that Trump’s tariff and tax plans could lead to a spike in inflation, also rose on data. The rate on the benchmark 10-year note continued to climb on Wednesday, recently trading above 4.7%, near levels last seen in late April.
Jobless Claims Total Less Than Expected
Initial filings for unemployment benefits fell last week, signaling that while the labor market may be softening, employers are not cutting staff.
Claims totaled 201,000 for the period ending Jan. 4, down 10,000 from the prior period for the lowest total in nearly a year. Economists surveyed by Dow Jones had been looking for 215,000.
Continuing claims, which run a week behind, totaled 1.87 million, an increase of 33,000 from the week before.
—Jeff Cox
Stocks Making Biggest Moves Before Bell
se are stocks moving most in premarket trading:
- SolarEdge Technologies — solar stock dropped 6%. Citi downgraded SolarEdge to sell from neutral, saying the company faces “stubbornly high” operating expenses despite its restructuring announcement.
- Novo Nordisk — a pharmaceutical giant rose more than 3% following an upgrade to buy from neutral at UBS.
- Maplebear — Shares of parent of grocery delivery company Instacart popped nearly 5%. Maplebear is set to replace Enovis in the S&P MidCap 400 index, effective before trading commences on Tuesday, Jan. 14.
For a full list of stocks making moves, visit our website.
— Lisa Kailai Han
ADP Report Highlights Job Growth Slowdown
Private sector companies added fewer jobs than expected during December, while wages grew at the slowest pace in nearly three-and-a-half years, according to ADP.
Companies added a seasonally adjusted 122,000 jobs for the month, down from 146,000 additions in November and less than the Dow Jones consensus forecast of 136,000. It marked the smallest increase since August.
“The labor market downshifted to a more modest pace of growth in the final month of 2024, with a slowdown in both hiring and pay gains,” ADP chief economist Nela Richardson said.
— Pia Singh, Jeff Cox
Stock Futures React to Trump Tariff Plans
Stock futures took a hit Wednesday morning after CNN reported that President-Elect Donald Trump could declare a national economic emergency to implement broad-reaching tariff plans.
This declaration would allow Trump to use the International Economic Emergency Powers Act (IEEPA) to manage imports during a national emergency, sources said. However, Trump’s team is still weighing legal options for creating a tariff plan.
The potential for such sweeping measures has added to market jitters, with investors closely monitoring developments as Trump prepares to take office later this month.