US markets trade sideways ahead of key payrolls data

Markets drifted sideways as investors remained on the sidelines ahead of the crucial May non-farm payrolls numbers due out Friday US time.

The S&P 500 just tipped into the red closing down 0.02 per cent. The Nasdaq also finished just in the red down 0.09 per cent and the Dow Jones was the only one of the major indexes to finish in positive territory finishing 0.20 per cent higher.

The focus for investors will now turn to Friday’s nonfarm payrolls report for May, as investors are hoping for signs of a softer labour market which would support the Fed’s case for rate cuts. Economists polled by Dow Jones expect a jobs gain of 190,000.

In company news, Lululemon closed 4.8 per cent higher after the sportswear manufacturer reported better than expected first quarter results. Five Below fell 10.6 per cent after reporting disappointing results and softer than expected guidance.

Turning to US sectors, the worst performing sector was Utilities which finished down 1.03 per cent. The best performer was Consumer Discretionary which closed 0.97 per cent higher.

In European news, the ECB announced a much anticipated 25 basis point cut to the banks key rate. The key rate now sits at 3.75 per cent. Money markets had fully priced in the 25 basis point move lower at the June gathering. It is the first cut since September 2019, when the deposit facility was in negative territory.

Lagarde has acknowledged to reporters that the outlook on inflation has improved “markedly” and stated there’s a “strong likelihood” that the ECB is shifting into a “dialing-back phase”.
She did however decline to confirm that such a change of gear has now happened.

Futures

The SPI futures are pointing to a 0.2 per cent gain.

Currency

One Australian dollar at 7.20am was buying 66.68 US cents.

Commodities

Gold has added 0.65 per cent. Silver has gained 4.30 per cent. Copper has risen 1.56 per cent. Oil has gained 2.00 per cent.

Figures around the globe

European markets closed higher. London’s FTSE added 0.47 per cent, Frankfurt gained 0.41 per cent, and Paris closed 0.42 per cent higher.

Turning to Asian markets, Tokyo’s Nikkei gained 0.55 per cent, Hong Kong’s Hang Seng added 0.28 per cent while China’s Shanghai Composite closed 0.54 per cent lower.

Yesterday, the Australian share market closed 0.68 per cent higher at 7,821.77.

Dividends payable
PT Aneka Tambang Tbk (ASX:ATM)
Tamawood Ltd (ASX:TWD)
Tasmea Ltd (ASX:TEA)

Sources: Bloomberg, FactSet, IRESS, TradingView, UBS, Bourse Data, Trading Economics, CoinMarketCap.

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