Early rebound attempt stonewalled by the under-performance of small-caps
US stocks ended Tuesday, 03 June 2014 marginally lower, pausing after three straight days of gains that sent the S&P 500 and Dow Jones Industrial Average to record levels on Monday. Equity indices faced an uphill climb from the opening bell, but the early rebound attempt was stonewalled by the under-performance of small-caps. Investors found little comfort in a factory orders report, which was mostly in line with expectations, and better-than-expected monthly car sales.
The Dow Industrials shed 21.29 points, or 0.1%, to 16,722.34. The Nasdaq Composite ended the day down 3.12 points, or 0.1%, at 4,234.08. The S&P 500 closed less than a point lower at 1,924.24.
Six out of ten sectors ended higher led by finnacials and energy sectors.
In news on Tuesday the rate of consumer price inflation in the European Union was up 0.5%, year-on-year, in May. That was the lowest reading in four years. A figure of up 0.7% was expected by the market place. Unemployment in the EU was also reported Tuesday, coming in at 11.7% in April from 11.8% in March. Thursday's monthly monetary policy meeting of the ECB is widely believed to see the bank announcing further monetary policy stimulus measures. Recent weak European Union economic data and fears of deflation setting in for the EU are solid reasons for the ECB to make a move next week. Such would be another bearish below to the Euro currency.
U.S. economic data released Tuesday included the ISM New York report on business, manufacturers' shipments and inventories, the IBD/TIPP economic optimism index, the global manufacturing PMI, and domestic auto sales. Factory orders, increased 0.7% following an upwardly revised 1.5% (from 1.1%) increase in March. The Briefing.com consensus expected an increase of 0.5%.
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The big U.S. data point of a busy data week is Friday's Labor Department employment situation report for May. The early forecast is for non-farm payrolls to have increased 215,000 in the report.
The auto industry was in focus after car makers released their monthly sales figures. Shares in General Motors and Ford Motors rose 1.1% and 0.7% respectively after they released their monthly car sales in the U.S.
U.S. Treasury prices fell, sending yields higher for a fourth consecutive session, as prices retraced their fall in recent weeks. The 10-year note yields rose to 2.6%.
Bullion prices ended steady on Tuesday, 04 June 2014 at Comex. Gold prices ended the U.S. day session near steady levels but hit another four-month low early on with traders looking ahead to the week's economic events, including a European Central Bank meeting and the monthly U.S. nonfarm payrolls report.
Gold for August tacked on 50 cents to settle at $1,244.50 an ounce on the Comex division of the New York Mercantile Exchange. Prices had tallied a loss of roughly 4%, or just over $50 an ounce, over the past six trading sessions. July silver meanwhile, gained over 2 cents, or 0.1%, on Tuesday to close at $18.76 an ounce, extending its gain from a day earlier, which followed a five-session decline.
Crude Oil futures settled slightly higher on Tuesday, 03 June 2014 at Nymex rebounding from their lowest settlement level in two weeks with traders finding little reason to make any big moves ahead of weekly data on petroleum supplies.
July crude climbed by 19 cents, or 0.2%, to settle at $102.66 a barrel on the New York Mercantile Exchange. Market expects this week's reports to show a decline of 2 million barrels in crude inventories for the week ended 30 May 2014. They also forecast a rise of 2 million barrels in gasoline stockpiles and a decline of 1 million barrels for distillate supplies, which include heating oil.
Indian ADRs ended mixed on Tuesday. Among the banking name, ICICI Bank shed 0.91% at $51.02 and HDFC Bank was up 0.11% at $47.19. In the IT segment, Wipro fell 1.44% at $10.93 and Infosys ADR was down 0.57% at $51.97. In the other sectors, Tata Motors rose 0.32% at $37.64 and Dr Reddy's Laboratories declined 2.89% at $39.60.
Tomorrow, the weekly MBA Mortgage Index will be released at 7:00 ET, while the ADP Employment Change for May (consensus 200,000) will cross the wires at 8:15 ET. The April Trade Balance (consensus -$41.30 billion) and Q1 Productivity (consensus -2.5%) and Unit Labor Costs (consensus 4.8%) will be reported at 8:30 ET, while the May ISM Services Index (consensus 55.5) will be released at 10:00 ET. The day's data will be topped off with the 14:00 ET release of the Fed's Beige Book for June.
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