US open: Stocks slip as Treasury yields grind back higher

Stocks on Wall Street were falling back in early trading following the release of a batch of stronger-than-expected economic data.

Those served to push government bond yields higher both on the front and so-called back end of the interest rate curve as traders priced in a greater likelihood of more interest rate hikes by the central bank.

As of 1541 BST, the Dow Jones Industrials was retreating 1.44% or 498.51 points to 33,790.43, while the technology-laden Nasdaq Composite was off by 1.38% at 13,600.67.

In the background, the yield on the benchmark 10-year US Treasury note was climbing 13 basis points to 4.07%, reflecting the possibility of higher inflation.

The yield on the policy-sensitive two-year Treasury was up by 14bp at 5.09% - having earlier hit a fresh 52-week high.

The spot US dollar index was up 0.14% to 103.52, while gold and West Texas Intermediate crude oil futures were dragged lower.

Fed funds futures were left discounting almost even odds of short-term official interest rates hitting 5.5-5.75% by November 2023.

Worth noting, the all-important monthly non-farm payrolls report was due out on the following day.

A trio of reports linked to the jobs market all came in on the strong side on Thursday.

Chief among those was consultancy ADP's private sector payrolls figures, which showed a 497,000 surge in payrolls for the month of June.

Although the ADP report was often enough dismissed by economists as unreliable - when not erratic - staffing firm Challenger said that job cut announcements nearly halved last month.

Shortly afterwards, the Department of Labor reported that the so-called 'quits rate' increased by two-tenths of a percentage point in May to 2.6%.

According to Oxford Economics, the quits date validated their forecast for an above consensus payrolls number on Friday.

In parallel, the Institute for Supply Management said that its Purchasing Managers' Index for the US services sector rebounded significantly in June.

That closely followed gauge improved from 50.3 in May to 53.9 (consensus: 51.2).

Ian Shepherdson at Pantheon Macroeconomics noted the rise in the sub-index for employment contained in the ISM report, saying that it was consistent with a gain in non-farm payrolls north of 400,000 in June.

Nonetheless, he went on to add that: "The key number [...is] consistent with payroll growth north of 400K. That chimes with the strong ADP print earlier today, but those data are deeply unreliable and the ISM employment index has tended to overstate payroll growth since the turn of the year; the February surge in the index, for example, coincided with a sharp downshift in payroll growth.

"The Homebase numbers and NFIB hiring intentions, by contrast, are better guides to payroll growth in individual months, and they signal June payroll growth of around 200K."

Dow Jones - Risers

Microsoft Corp. (MSFT) $339.69 0.46%
Dowdupont Inc. (DWDP) $0.00 0.00%
Procter & Gamble Co. (PG) $151.56 -0.45%
Unitedhealth Group Inc. (UNH) $469.07 -0.46%
Walmart Inc. (WMT) $157.32 -0.50%
Coca-Cola Co. (KO) $60.65 -0.63%
Apple Inc. (AAPL) $190.02 -0.68%
Verizon Communications Inc. (VZ) $37.17 -0.84%
Merck & Co. Inc. (MRK) $112.68 -0.90%
Visa Inc. (V) $237.26 -0.91%

Dow Jones - Fallers

American Express Co. (AXP) $168.62 -3.96%
Intel Corp. (INTC) $31.50 -3.09%
3M Co. (MMM) $95.98 -2.69%
Salesforce.Com Inc. (CRM) $208.37 -2.55%
Nike Inc. (NKE) $104.51 -2.42%
Chevron Corp. (CVX) $152.58 -2.39%
Travelers Company Inc. (TRV) $168.67 -2.27%
Caterpillar Inc. (CAT) $239.38 -2.23%
Walt Disney Co. (DIS) $87.99 -2.00%
JP Morgan Chase & Co. (JPM) $141.76 -1.99%

S&P 500 - Risers

Borg Warner Inc. (BWA) $43.93 1.74%
Meta Platforms Inc. (META) $296.86 0.85%
Quest Diagnostics (DGX) $138.90 0.51%
Microsoft Corp. (MSFT) $339.69 0.46%
Amerisource Bergen Corp. (ABC) $191.34 0.36%
Kroger Co. (KR) $47.20 0.35%
Rollins Inc. (ROL) $43.15 0.30%
O'Reilly Automotive Inc. (ORLY) $949.59 0.18%
Automatic Data Processing Inc. (ADP) $220.10 0.18%
CIGNA Corp. (CI) $281.17 0.15%

S&P 500 - Fallers

VF Corp. (VFC) $17.92 -5.54%
Comerica Inc. (CMA) $41.38 -4.87%
Freeport-McMoRan Inc (FCX) $37.30 -4.80%
Celanese Corp. (CE) $109.64 -4.28%
Vornado Realty Trust (VNO) $17.37 -4.24%
Paypal Holdings Inc (PYPL) $65.93 -4.24%
Coty Inc. Class A (COTY) $11.99 -4.24%
CenturyLink Inc. (LUMN) $2.16 -4.20%
ConocoPhillips (COP) $99.89 -3.97%
American Express Co. (AXP) $168.62 -3.96%

Nasdaq 100 - Risers

Qurate Retail Inc. (QRTEA) $1.03 0.98%
Meta Platforms Inc. (META) $296.86 0.85%
Microsoft Corp. (MSFT) $339.69 0.46%
Liberty Global plc Series C (LBTYK) $17.86 0.25%
O'Reilly Automotive Inc. (ORLY) $949.59 0.18%
Automatic Data Processing Inc. (ADP) $220.10 0.18%
Liberty Global plc Series A (LBTYA) $16.91 0.15%
Verisk Analytics Inc. (VRSK) $226.30 0.11%
Mylan Inc. (MYL) $0.00 0.00%
Cerner Corp. (CERN) $0.00 0.00%

Nasdaq 100 - Fallers

Mercadolibre Inc. (MELI) $1,171.76 -6.06%
Paypal Holdings Inc (PYPL) $65.93 -4.24%
Trip.com Group Limited (TCOM) $33.67 -4.10%
Wynn Resorts Ltd. (WYNN) $97.86 -3.82%
Biomarin Pharmaceutical Inc. (BMRN) $84.03 -3.72%
JD.com, Inc. (JD) $34.03 -3.32%
Intel Corp. (INTC) $31.50 -3.09%
Align Technology Inc. (ALGN) $326.51 -3.06%
Netflix Inc. (NFLX) $432.67 -2.97%
Expedia Group Inc. (EXPE) $108.30 -2.91%