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

A series of underwhelming economic reports pulled the markets lower ahead of the Federal Open Market Committee announcement on Wednesday afternoon. At 12:45 p.m.:

DJIA: -0.45% to 14,773.40 S&P 500: -0.37% to 1,591.59 NASDAQ: -0.47% to 3,313.25
Gold: -$28.30 to $1,443.80 per ounce Oil: -$2.97 to $90.49 per barrel U.S. 10-Year: -0.051 points to 1.621%

Here are three stories moving markets on Wednesday afternoon:

1) U.S. Economy Tumbles Into Spring on Mixed Manufacturing Data: “The PMI survey suggests that the economy is showing signs of yet another ‘spring swoon’ as it moves into the second quarter, linked to a softening of demand in the home market,” commented Chris Williamson, chief economist at Markit, in the firm’s April U.S. manufacturing PMI report.

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Markit’s PMI index fell from 54.6 to 52.1, indicating expansion but at a slower rate than before. The new orders index declined from 55.4 to 51.5, also expanding but at a much slower rate than before. In turn, the backlogs of work index fell from 50.2 to 49.9, contracting for the month… (Read more.)

2) Is This Data Evidence of a Labor Market Slowdown? Gains recorded by the Labor Department’s weekly report on initial claims for unemployment benefits had begun to paint a rosy picture of increasing strength in the labor market at the beginning of the year. Then came March’s Employment Situation report — compiled by the Bureau of Labor Statistics — showing that the United States economy created a disappointing 88,000 jobs in March, a sharp decline from the 268,000 jobs added to payrolls in February. Those figures were a new low for the recovery, and the month’s participation rate was even at its lowest since 1979.

The picture of April’s labor market gains is similarly grim. Payroll processor ADP, along with Moody’s Analytics, announced Wednesday that businesses added 119,000 jobs to their payrolls from March to April — a figure below analysts’ expectations for 150,000 new jobs… (Read more.)

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3) Underwhelming Economic Reports Pull Markets Lower: Manufacturing continued to expand in April, albeit at a slower pace than in March, according to the April 2013 Manufacturing ISM Report on Business. According to the Institute for Supply Management, the PMI registered 50.7 percent, a 0.6 percentage point drop from March’s reading of 51.3 percent.

A separate report released on Wednesday by the Census Bureau showed that construction outlays unexpectedly fell 1.7 percent on the month. Economists were expecting a sequential increase of 0.6 percent. Total spending is still up 4.8 percent on the year. April’s relative weakness was led by a 4.1 percent decline in public outlays. At a glance, it looks like overall construction spending is slowing down with the exception of the housing market… (Read more.)

Don’t Miss: Underwhelming Economic Reports Pull Markets Lower.