US open: Stocks little changed as private sector jobs growth picked up in February

US stocks were little changed on Wednesday as data showed that private sector jobs growth picked up last month bolstering expectations of an interest rate hike by the Federal Reserve next week, while the dollar strengthened.

At 1551 GMT, the Dow Jones Industrial Average and S&P 500 were flat at 20,910.79 and 2,369.89, while the Nasdaq was up 0.31% to 5,852.19.

Meanwhile, West Texas Intermediate was down 0.85% to $52.69 per barrel and Brent crude fell 0.64% to $55.58.

In currency markets, the dollar was up 0.35% versus the pound to 0.8225, was flat against the euro at 0.9472 and up 0.57% versus the yen to 114.63.

On the data front, ADP employment data, a precursor to the all-important non-farm payrolls report, revealed that 298,000 private sector jobs were added in February, the most since April 2014 and well above the 187,000 expected.

As investors bet the Fed will hike rates at its meeting on 14-15 March, analysts said investor focus will shift to the release of the non-farm payrolls report on Friday for signs of continued growth.

Following the stronger than expected ADP data, gold extended its decline on expectations of a rate hike, as the yellow metal fell 0.64% to $1,208.30 per troy ounce.

Berenberg analysts Roiana Reid and Mickey Levy said: “The ADP report revealed some interesting trends. Small businesses continued to ramp up their payrolls after sluggish hiring in the months preceding the elections. The 104,000 jobs added is the largest since June 2016 and reflects the surge in optimism among small businesses in recent months.

“The Fed is highly likely to hike in March, but what’s next? The Fed will certainly acknowledge the strong job gains along with other data and soaring confidence. If job gains of this magnitude continue and wages tilt up and inflation pressures build, the Fed will be forced to hike more than expected in 2017-2018. Moreover, as we have noted, if pro-growth fiscal reforms are enacted, the Fed’s policy adjustments would be accentuated.”

Meanwhile, US wholesale inventories dropped 0.2% in January, after rising 1% in December. Economists had expected inventories to fall 0.1%.

On the corporate front, health stocks could be in focus again as investors digest the Republican party’s plans to dismantle the Affordable Care Act, commonly known as Obamacare. Ionis Pharmaceuticals gained 3.01% and Sage Therapeutics was up 2.3%.

Nvidia rose 1.77% in the pre-market after the tech firm said that it plans to put artificial intelligence into many different products beyond self-driving cars.

Dick’s Sporting Goods gained 2.84% after the retailer said it will cut about 20% of its vendors and took a $46m right down.

Vera Bradley fell 4.29% as it beat fourth quarter profit expectations bt gave a downbeat outlook

Hovnanian Enterprises slumped 7.85% as the housebuilder posted a 4.1% fall in revenue to $575.6m.

Urban Outfitters was down 5.59% after it missed fourth quarter revenue and earnings forecasts.