Stocks fell, as concern the budget deal won't reduce the deficit fast enough offset a better-than-forecast jobs report and a rally among retailers. Moody's Investors Service on Wednesday had said the budget accord will not reduce the nation's red ink enough to avert a sovereign-rating downgrade.
For the day, the Dow ended lower by 21.19 points (0.2%) at 13,391.4. Nasdaq ended lower by 11.7 points (0.4%) at 3,100.6. S&P 500 ended lower by 3.05 points (0.21%) at 1,459.37.
All ten economic sectors had a mixed finish. Technology and materials sectors were hardest hit and consumer discretionary and health-care fared best among its 10 major sectors. Dow components also had a mixed finish. United Healthcare was the biggest loser.
Investors also looked forward to minutes from the Federal Open Market Committee's December meeting, which was due for release during post lunch hours. The minutes of the latest meeting of the Federal Reserve's Open Market Committee were released on Thursday afternoon and they somewhat surprisingly revealed some FOMC members believe that quantitative easing of U.S. monetary policy should be wound down during 2013. The past four years of very easy U.S. monetary policy have been an underlying bullish factor for the raw commodity sector.
In the currency market, the dollar index, which weighs the strength of the dollar against a basket of six other currencies rose by 0.3% on Thursday.
In Europe overnight there was fresh data showing the Euro zone continues to see a very fragile financial sector. European Union bank loans to the private sector fell by 0.8% in November, on an annualized basis. Lending to businesses also declined. European stocks and the Euro currency were weaker on Thursday. In Asia news, China reported its non-manufacturing PMI rose for the third straight month, to 56.1 in December. Recent economic data coming from China has been upbeat, which is an underlying bullish factor for most markets.
Among economic data expected for the day at Wall Street, ADP estimated the economy added 215,000 private-sector jobs in December, with the better-than-expected figure boding well for Friday's nonfarm-payrolls report. Market expects the government to report nonfarm payrolls rose by 153,000 last month. Separately, the Labor Department said initial claims for unemployment benefits last week jumped 10,000 to a five-week high of 372,000. Market had called for 360,000 claims. As for continuing claims, they rose to 3.245 million from 3.201 million.
Other data showed that the weekly MBA Mortgage Applications decreased by 10.4%, which follows last week's 11.2% downtick. Elsewhere, December Challenger Job Cuts declined 22.1%, and today's reading follows the prior month's 34.4% increase.
Shares of automakers responded to December car sales data. Among the notable movers, Ford Motor rose by 2.0% after the company reported a 5% increase in December car sales. General Motors sales also grew by 5.0%, and the stock added 2.4% in response to the positive data. Looking at foreign-based carmakers, Toyota Motor shed 0.7% despite reporting a 9.0% rise in its December sales. During 2012, Toyota sold almost 2.1 million vehicles.
Bullion metals at Comex finished lower on Thursday, 03 January 2013. Gold for February delivery fell $14.2 (0.8%) to settle at $1,674.6 an ounce on the Comex division of the New York Mercantile Exchange on Thursday. On Thursday, March silver fell $0.29, or 0.9% to settle at $30.72 an ounce.
Crude oil prices ended lower on Thursday, 03 January 2013 at Nymex.
Prices had been seesawing between small losses and gains as traders assessed oil demand prospects in the wake of the U.S. fiscal-cliff deal and some upbeat economic data out of China. Strong dollar also pushed prices lower. On Thursday, light and sweet crude oil futures for light sweet crude for February delivery closed lower by $0.20 (0.2%) at $92.92/barrel. It fell to a low of $92.49 and rose to a high of $92.3 during intra day trading.
On Thursday, 707 million shares traded on the New York Stock Exchange, and composite volume topped 3.79 billion.
Indian ADRs ended mixed on Thursday. In the Banking space, ICICI Bank was down 1.2% and HDFC Bank fell 0.7%. In the IT space, Infosys was up 1.4% and Wipro was up 0.9%. In the Telecom space, MTNL fell 1% and Tata Communication was up 4.2%. In the other space, Sterlite was unchanged, Tata Motors was down 1.5%. Dr Reddys was up 0.6%.
For tomorrow, in terms of economic data, December nonfarm payrolls, nonfarm private payrolls, the unemployment rate, hourly earnings, and average workweek will all be reported. Lastly, November factory orders and December ISM services will hit the wires at 10:00 ET.
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