US stocks drift ahead of Thursday's jobs report

NEW YORK — (AP) — U.S. stocks are drifting on Wednesday, as Wall Street’s record-breaking rally slows ahead of a highly anticipated report coming Thursday about the U.S. economy.

The S&P 500 was up by 0.2% in midday trading, coming off its first loss after hitting all-time highs in back-to-back days. The Dow Jones Industrial Average was up by 13 points, or less than 0.1%, as of 11:30 a.m. Eastern time, and the Nasdaq composite was 0.7% higher.

Treasury yields were mixed in the bond market ahead of Thursday’s report, which will show how many jobs U.S. employers created and destroyed last month. The widespread expectation is that they hired more people than they fired but that the pace of hiring slowed from May.

A stunningly weak report released Wednesday morning, though, raised worries that Thursday’s report may fall short. The data from ADP suggested that U.S. employers outside the government cut 33,000 jobs from their payrolls last month, when economists were expecting to see growth of 115,000 jobs.

“Though layoffs continue to be rare, a hesitancy to hire and a reluctance to replace departing workers led to job losses last month,” according to Nela Richardson, chief economist at ADP.

The ADP report does not have a perfect track record predicting what the U.S. government’s more comprehensive jobs report will say each month. That preserves some hope that Thursday’s data could be more encouraging. But a fear has been that uncertainty around President Donald Trump’s tariffs could cause employers to freeze their hiring.

Many of Trump’s stiff proposed taxes on imports are currently on pause, and they’re scheduled to kick into effect in about a week. Depending on how big they are, they could hurt the economy and worsen inflation. Even if they’re not that punishing, all the on-and-off uncertainty about tariffs leading up to this point may have caused damage by itself.

Other factors could also be dragging on the job market, such as the U.S. government’s termination of protected status for 350,000 Venezuelans, potentially exposing them to deportation. That alone could create a drag on payrolls of 25,000 jobs, according to Goldman Sachs economist David Mericle, whose forecast for Thursday’s report is weaker than many of his peers.

In the bond market, the yield on the 10-year Treasury rose to 4.29% from 4.26%. But the two-year Treasury yield, which more closely tracks expectations for what the Federal Reserve will do with its overnight interest rate, edged down to 3.77% from 3.78%.

An unexpected weakening of the job market could push the Fed to cut interest rates in order to give the economy a boost. So far this year, the Fed has said it would rather wait to see how Trump’s tariffs affect the economy and inflation before cutting rates any further.

Trump, meanwhile, has been angrily calling for cuts to rates to happen sooner.

On Wall Street, Tesla rose 4.3% after the electric-vehicle company said it delivered nearly 374,000 of its Model 3 and Model Y automobiles last quarter. That was better than analysts expected, according to FactSet, though its overall sales fell 13% from a year earlier. Worries have been high that potential Tesla buyers are getting turned off by CEO Elon Musk’s involvement in politics.

Constellation Brands climbed 4.4% despite reporting a weaker profit for the latest quarter than analysts expected. The seller of Modelo beer and Robert Mondavi wine said that growth in jobs slowed during the quarter for the construction industry and other “4000 calorie+” sectors, which tends to hurt demand for its beer. But it nevertheless stuck with its financial forecasts for the full upcoming year.

Centene tumbled 38.7% after the health care company withdrew its forecasts for profit this year. That followed an initial look at some data suggesting sickness trends in many of the states where Centene does business are worse than expected.

In stock markets abroad, indexes were mixed as the July 9 deadline approaches for Trump and other countries to make trade deals before Trump’s tariffs come off their pause.

France’s CAC 40 rose 1.1%, and Hong Kong’s Hang Seng gained 0.6%. But Japan’s Nikkei 225 fell 0.6%, and South Korea’s Kospi dropped 0.5%.

___

AP Writers Teresa Cerojano and Matt Ott contributed.

Copyright 2025 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed without permission.