Thursday’s Mid-Day Movers: 3 Stories Driving Markets

The major stocks wavered Thursday afternoon, awaiting the May employment report that will be released Friday. As of 12 p.m.:

DIJA: -0.05% to 14952.57 S&P 500: +0.16% to 1611.51 NASDAQ: +0.08% to 3404.36
Gold: +0.78% to 78.3999 Oil: +1.52% to 22.07 U.S. 10-Year: -1.10% to 20.77

Here are three stories helping shape the market Thursday afternoon.

1. Are Stocks Finally Running Out of Steam? The relentless move higher in stocks finally appears to be taking a much needed breather. Recent chatter about the Federal Reserve dialing down its bond-purchasing programs in the near future is worrying some investors, but Mr. Market isn’t hitting the panic button just yet.

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The Dow Jones Industrial Average (NYSEARCA:DIA) finished May in the green this year for the first time since 2009. The index logged a six-month winning streak, while the S&P 500 (NYSEARCA:SPY) extended its streak to seven months, its best run in over three years. However, both indices have failed to make new highs that were reached on May 22 — the same day the Federal Reserve released its Federal Open Market Committee minutes… (Read more.)

2. Layoffs May Be Slowing, But When Will Hiring Accelerate? The picture of the health of the job market that is slowly emerging from recently released economic data is one that has made marginal improvements since April. While employment gains were disappointingly low at 135,000, ADP’s National Employment Report showed Wednesday that nonfarm payrolls added slightly more jobs last month than in the previous month. Even better for the job market were the layoff figures reported earlier Thursday by Challenger, Gray & Christmas, which showed that the number of planned layoffs at U.S. businesses fell in May for the third month in a row.

On Thursday, U.S. Department of Labor also contributed data to this mix. Initial claims for unemployment benefits dropped last week for the first time in three weeks, according to the Bureau of Labor Statistics, pointing to more slow and choppy improvement in the job market… (Read more.)

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3. Here’s Why The Pressure to Cut Workers Hasn’t Materialized: While economists saw evidence in ADP’s National Employment Report that the large federal spending cuts had created a “softer job market this spring,” the number of planned layoffs at U.S. businesses fell in May for the third consecutive month. Employers announced 36,398 job cuts last month, a 4.5 decrease from the 38,121 cuts made in April, according to the outplacement consultancy firm Challenger, Gray & Christmas. For Chief Executive Officer John Challenger, this decrease means the economic “pressure to cut people just isn’t there.”

In fact, an examination of Challenger’s numbers showed little evidence that fiscal austerity in Washington was hurting job growth. However, May typically experiences the smallest number of layoffs each year… (Read more.)

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