Stock Futures Extending Losses On Disappointing ADP Payrolls

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Stock futures are back on the defensive following a smaller than expected gain in private payrolls according to a monthly report from ADP. Employers added 175,000 new jobs last month following a downward revision to December to 227,000. And although the harsh winter weather has negatively influenced December data from initial jobless claims to retail sales, ADP numbers tend to be insulated from external factors. As a result, the expectation for economists to revise their non-farm payrolls estimates lower is also having a dampening effect on Wall Street this morning.

Another factor weighing on the markets was the inability for the Dow Industrials to close above its 200-day moving average on Tuesday. This led most technicians to claim that bears still had a solid grip on the market, amplified by bearish fundamentals such as the downgrade in Puerto Rican municipal debt, continued weakness in emerging markets and lingering pressure on the dollar.

In Europe, the financial markets are giving back their marginal gains achieved overnight in sympathy with softer U.S. markets.

The remaining data for today includes the Institute for Supply Management index non-manufacturing index for January, expected to improve slightly to 53.7 from 53.0 in December.

-Dow Jones Industrial down 0.18%

-S&P 500 futures down 0.30%

-Nasdaq 100 futures down 0.23%

SENTIMENT

Nikkei up 1.23%

Hang Seng down 0.60%

Shanghai Composite down 0.82%

FTSE-100 up 0.25%

DAX-30 down 0.28%

PRE-MARKET SECTOR WATCH

(-) Large cap tech: lower

(-) Chip stocks: lower

(-) Software stocks: lower

(-) Hardware stocks: lower

(+/-) Internet stocks: mixed

(+/-) Drug stocks: mixed

(-) Financial stocks: lower

(-) Retail stocks: lower

(-) Industrial stocks: lower

(-) Airlines: lower

(-) Autos lower

UPSIDE MOVERS:

RL (+5.80%) Q3 earnings topped expectations, raised FY 2013 guidance and increased share buyback by $500 million

MYGN (+11.85%) Beat earnings estimates, raised guidance and announced plans to purchase Crescendo Bioscience for $270 million

SEV (+24.16%) Reported EPS of $0.14 per diluted share, compared with a net loss of $0.39 per share, in the same period last year.

DOWNSIDE MOVERS:

RPTP (-8.68%) Wedbush Morgan downgraded the stock to Underperform from Neutral.

CVS (-1.68%) Announced plans to stop selling tobacco products by October 1, 2014.

EXTR (-17.90%) Missed Q2 earnings estimates and lowered Q3 guidance



The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of The NASDAQ OMX Group, Inc.

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