In a day marked by fluctuations, US equity indexes exhibited declines during midday trading on Wednesday. This downturn followed the unexpected drop in jobless claims and disappointment in private payroll growth. The S&P 500 experienced a slight decrease of 0.2%, settling at 5,897.1 points. The Nasdaq Composite followed suit, falling by 0.4% to 19,414.2 points, while the Dow Jones Industrial Average also declined by 0.2%, reaching 42,449.6 points.
Throughout the session, all three indices oscillated between gains and losses, indicating a volatile market environment. Sector performance revealed that communication services and utilities were among the leading decliners intraday while the healthcare sector emerged as the prominent gainer of the session. Turning to the bond market, US Treasury yields displayed a mixed performance.
The 10-year yield remained stable at 4.69%, marking its highest point during intraday trading since late April, according to data analyzed. The yield on the 10-year Treasury reached an intraday high of 4.73%. Conversely, the two-year yield saw a reduction of 1.4 basis points, settling at 4.28%. On the economic front, initial jobless claims in the US unexpectedly fell to 201,000 for the week ending January 4.
This figure represents the lowest level recorded since February, contradicting predictions which suggested an increase to 215,000 based on a survey compiled by Bloomberg. The prior week’s claims stood at 211,000. In the realm of private employment, ADP’s monthly report indicated an increase of 122,000 jobs in December, which fell short of the expected growth of 139,000 jobs according to various Bloomberg polls.
This figure also trailed behind the previously reported 146,000 jobs from November. In notable company updates, Meta Platforms ($META) announced plans to initiate a test in the US, France, and Germany, allowing users to browse eBay ($EBAY) listings on the Facebook Marketplace, facilitating transactions to be completed on eBay.
This announcement positively impacted eBay shares, which surged 9.5% during the day, making it the top performer within the S&P 500. Meanwhile, Deutsche Bank took the step of downgrading shares of Palo Alto Networks ($PANW) from 'buy' to 'hold', while also adjusting its price target from $207 down to $190.
BTIG echoed this sentiment by lowering Palo Alto's stock rating to 'neutral' from 'buy'. As a result, Palo Alto's shares fell by 3.9%, positioning them amongst the underperformers on the Nasdaq. Adding to market concerns, West Texas Intermediate crude oil futures saw a decline, dropping 1.1% to $73.43 per barrel.
This downward trend in energy prices continues to reflect the uncertain economic landscape the country is navigating..