US close: Stocks finish flat ahead of non-farm payrolls

(Sharecast News) - US stocks finished mixed on Thursday, with the S&P 500 and Nasdaq pausing just under the record highs reached the previous session as investors refrained from taking on too much risk ahead of Friday's all-important employment report. Wall Street gave a relatively muted reaction to an interest-rate cut across the Pond, as the European Central Bank reduced rates for the first time in five years, sending stocks across Europe higher.

Instead, US investors were digesting a barrage of mixed domestic economic data, with jobless claims rising strongly while national productivity rose more than forecast and labour cost growth slowed.

"New data theoretically increases the chances of the Fed cutting rates. Weekly jobless claims are up more than expected, implying the labour market isn't as tight as previously thought, thus giving the Fed less of a reason to sit on its hands," said Dan Coatsworth, investment analyst at AJ Bell.

The S&P 500 closed just 0.02% lower after hitting a new all-time closing high of 5,354.03 on Wednesday, while the Nasdaq fell just 0.09% from the previous peak of 17,187.90. The Dow however rose 0.20% to 38,886.17.

Turning to Friday's employment report, consensus forecasts are for a 185,000 increase in non-farm payrolls in May, a tad higher than April's print of 175,000, while the annual increase in average annual earnings is expected to be steady at 3.9%.

Economists at Oxford Economics said they are anticipating a reading of 205,000, as May experienced seasonably normal weather, as opposed to April's higher than usual rainfall. However, they said: "Even if our forecast is correct, trend job growth is slowing, but the Federal Reserve will want the deceleration to remain orderly."

Economic data

On the macro front, US-based employers announced 64,789 cuts in April, according to Challenger, Gray & Christmas, down 28% from March's 14-month high of 90,309 and the 66,995 cuts announced at the same time a year earlier.

According to the Department of Labor, initial jobless claims rose 8,000 to 229,000, above the 220,000 expected and the highest reading in a month.

Non-farm labour productivity increased by 0.2% in the first quarter, according to final estimates from the Department of Labor. This was lower than the initial reading of +0.3% but ahead of the 0.1% expected by the market.

The same report showed unit labour costs increased at an annual rate of 4.0% in the first quarter, revised lower than the 4.7% preliminary estimate and much lower than the 4.9% increase predicted.

Finally, the US trade deficit in goods widened to $99.41bn in April, according to an advance estimate from the Census Bureau, the largest reading in almost two years, after an upwardly revised $92.29bn print a month earlier. Imports rose by 3.1%, principally due to higher purchases of automotive vehicles, while exports rose by 0.5%.

Market movers

Nvidia pulled back after its recent eye-watering rally, falling 1.1% after hitting a new record high the previous session which pushed its market cap to more than $3trn. The stock has jumped by nearly a third in the past month alone, taking its year-to-date rise to 151%.

"Being caught up in a potential antitrust probe doesn't help the chip giant. Reports that the US Justice Department and Federal Trade Commission are moving forward with antitrust investigations into the dominance of Nvidia, OpenAI and Microsoft in the artificial intelligence industry is something to watch closely," AJ Bell's Coatsworth said.

GameStop shares were once again soaring after the closely followed Roaring Kitty investor scheduled an uncharacteristic livestream on YouTube for Friday. The stock finished 47% higher.

Activewear maker Lululemon gained 5% after beating forecasts with first-quarter results and guiding to stronger-than-expected full-year profits.

Meanwhile, the share price of Big Lots plunged by 18% after the discount chain reported a big drop in sales and a wider-than-expected loss in its first quarter which it blamed on a "challenging consumer environment".

Dow Jones - Risers

Salesforce.Com Inc. (CRM) $242.59 2.56% Nike Inc. (NKE) $95.66 1.42% Procter & Gamble Co. (PG) $168.40 1.42% Visa Inc. (V) $276.86 0.86% Merck & Co. Inc. (MRK) $130.54 0.84% Travelers Company Inc. (TRV) $209.67 0.60% Boeing Co. (BA) $190.83 0.52% Chevron Corp. (CVX) $155.73 0.48% Cisco Systems Inc. (CSCO) $46.21 0.41% McDonald's Corp. (MCD) $260.78 0.30%

Dow Jones - Fallers

Intel Corp. (INTC) $30.41 -1.22% Goldman Sachs Group Inc. (GS) $457.49 -0.91% 3M Co. (MMM) $98.24 -0.83% Apple Inc. (AAPL) $194.36 -0.77% Walgreens Boots Alliance, Inc. (WBA) $15.85 -0.56% American Express Co. (AXP) $233.40 -0.55% Amgen Inc. (AMGN) $305.70 -0.55% Walt Disney Co. (DIS) $101.20 -0.30% Caterpillar Inc. (CAT) $328.48 -0.29% JP Morgan Chase & Co. (JPM) $196.77 -0.25%

S&P 500 - Risers

Illumina Inc. (ILMN) $114.58 7.29% Paypal Holdings Inc (PYPL) $66.99 5.44% J. M. Smucker Co. (SJM) $115.32 4.52% Expedia Group Inc. (EXPE) $120.30 4.28% TripAdvisor Inc. (TRIP) $18.44 3.51% Newmont Corporation (NEM) $42.47 3.32% Iron Mountain Inc (New) (IRM) $84.91 3.12% Eastman Chemical Co. (EMN) $101.06 2.67% Salesforce.Com Inc. (CRM) $242.59 2.56% Perrigo Company plc (PRGO) $27.00 2.29%

S&P 500 - Fallers

NRG Energy Inc. (NRG) $77.81 -4.59% Nordstrom Inc. (JWN) $21.24 -4.52% Eaton Corporation plc (ETN) $313.29 -4.07% Foot Locker Inc. (FL) $25.87 -4.01% Dollar General Corp (DG) $129.54 -3.63% Quanta Services Inc. (PWR) $267.08 -3.21% Nektar Therapeutics (NKTR) $1.38 -3.17% Johnson Controls International plc (JCI) $69.68 -3.15% Carmax Inc. (KMX) $70.09 -3.06% Gap Inc. (GPS) $25.81 -2.97%

Nasdaq 100 - Risers

Illumina Inc. (ILMN) $114.58 7.29% Paypal Holdings Inc (PYPL) $66.99 5.44% Qurate Retail Inc. (QRTEA) $0.75 5.39% Expedia Group Inc. (EXPE) $120.30 4.28% Amazon.Com Inc. (AMZN) $184.88 1.99% Tesla Inc (TSLA) $177.99 1.71% Biomarin Pharmaceutical Inc. (BMRN) $80.85 1.48% Cognizant Technology Solutions Corp. (CTSH) $66.32 1.21% Workday, Inc. (WDAY) $214.88 1.14% Mercadolibre Inc. (MELI) $1,622.42 1.09%

Nasdaq 100 - Fallers

Micron Technology Inc. (MU) $129.92 -2.83% JD.com, Inc. (JD) $29.77 -2.68% Synopsys Inc. (SNPS) $573.70 -2.46% Western Digital Corp. (WDC) $75.21 -2.20% Biogen Inc (BIIB) $232.05 -1.97% Fastenal Co. (FAST) $63.94 -1.92% Dollar Tree Inc (DLTR) $112.36 -1.76% American Airlines Group (AAL) $11.44 -1.59% Henry Schein Inc. (HSIC) $68.59 -1.51% Vodafone Group Plc ADS (VOD) $9.60 -1.28%