Stocks traded lower as U.S. August manufacturing activity contracted for first time in six months
The S&P 500 and the Dow were little changed on Thursday morning as investors stayed on the sidelines ahead of a set of economic data, including Friday’s jobs report, while a rise in Charter Communications boosted the Nasdaq.
The stress on data has become especially apparent after Federal Reserve Chair Janet Yellen said last week that solid performance in the labor market has strengthened the case for an interest rate hike.
Investors will assess Friday’s monthly nonfarm payrolls numbers to see whether robust hiring from June continued through August. A Reuters survey of economists shows about 180,000 jobs were likely added in the month.
While the markets seem to be getting comfortable with the prospects of higher rates, the biggest question on everybody’s mind is the timing of the next increase.
A host of Fed officials have hinted that a rise could come as early as this month, but analysts have said the Fed would likely wait until December, given inflation rates running below its 2 percent target and the upcoming U.S. presidential elections in November.
Traders have priced in a 30 percent chance of a hike when the Fed meets on Sept 20-21. The odds rise to 57.2 percent for December, according to the CME Group’s FedWatch tool.
Charter Communications (CHTR.O) rose 3.4 percent to $265.87, after the S&P Dow Jones Indices said the cable services company is set to join the S&P 500 index. The stock provided the biggest boost to the Nasdaq, followed by a 0.3 percent rise in Microsoft (MSFT.O).
