US close: Markets tread water ahead of non-farm payrolls

US stocks finished flat to slightly lower on Thursday as investors chose to tread cautiously ahead of the much-anticipated non-farm payrolls report.

The Dow Jones Industrial Average finished down 0.03% at 33,120, the S&P 500 fell 0.13% to 4,258 while the Nasdaq slipped 0.12% to 13,220.

"Investors displayed mixed emotions on Thursday, with stocks pulling back while Treasury yields remained relatively stable, suggesting they continued to wear this week’s yield pain on their sleeves," said Stephen Innes, managing partner at SPI Asset Management.

The yield on a 10-year US Treasury was down 2.2 basis points at 4.714%, as it continued to retreat after reaching a new 16-year high of 4.887% earlier in the week after Tuesday's JOLTS survey pointed to a strengthening jobs market.

"Higher borrowing costs will likely continue weighing on the return on equity of S&P 500 companies, particularly growth stocks with high ROE, which may struggle in the higher rate environment," Innes said.

Stocks gained on Wednesday after the ADP Employment Report showed that just 89,000 jobs were created in September, down from an upwardly revised 180,000 the previous month and well below the 160,000 expected by analysts.

However, the 'official' non-farm payrolls report, due out on Friday, can often contrast with the ADP figures and is expected to show that job creation eased to 170,000 last month, from 187,000 previously.

In economic data on Thursday, jobless claims edged up to 207,000 in the week to 30 September, from a revised 205,000 the previous week – more or less in line with the consensus forecast (210,000).

"The claims data on their own will not shift the Fed's views, but we expect officials will need to see further softening in the September employment report due out tomorrow and beyond to prevent them raising rates one more time this year," said economist Michael Pearce from Oxford Economics.

Carmakers fall

Shares in Rivian plummeted nearly a quarter after the electric carmaker launched a $1.5bn convertible bond offering, following a $1.3bn offering in March. The funds will go towards the launch of its R2 Compact SUV vehicle.

Sector peer Tesla was slightly lower on the same day that the Securities and Exchange Commission sued founder Elon Musk in regards to its investigation into his Twitter takeover. The billionaire failed to appear at the SEC's San Francisco office three weeks ago and has since refused to appear for testimony.

Meanwhile General Motors was also out of favour on the news that it was heavily exposed to the US auto-safety regulator's recall of ARC Automotive-manufactured air-bag inflators. GM vehicles account for 20m of the total 52m vehicles affected.

Amazon fell while Microsoft was flat after UK regulator Ofcom requested an antitrust probe from the Competition and Markets Authority over their dominance of the public cloud infrastructure services market.

Dow Jones - Risers

Walt Disney Co. (DIS) $80.81 1.88%
Merck & Co. Inc. (MRK) $103.60 1.40%
Unitedhealth Group Inc. (UNH) $516.23 1.10%
Johnson & Johnson (JNJ) $157.12 1.04%
Visa Inc. (V) $233.48 0.98%
Verizon Communications Inc. (VZ) $31.82 0.89%
Travelers Company Inc. (TRV) $163.91 0.85%
Apple Inc. (AAPL) $174.91 0.72%
Goldman Sachs Group Inc. (GS) $310.50 0.62%
Chevron Corp. (CVX) $163.99 0.53%