U.S. Stocks May Give Back Ground On Disappointing Economic Data

(RTTNews) - Stocks are likely to come under pressure in early trading on Wednesday, giving back ground after trending higher over the past few sessions. The major index futures are currently pointing to a notably lower open for the markets, with the S&P 500 futures down by 0.9 percent.

Traders may look to cash in on the recent strength in the markets, which saw the S&P 500 close higher for six straight sessions and reach its best closing level in almost a month.

The futures saw further downside following the release of a Commerce Department report showing the U.S. economy unexpectedly shrank in the first quarter of 2025.

The report said real gross domestic product fell by 0.3 percent in the first quarter after surging by 2.4 percent in the fourth quarter of 2024. Economists had expected GDP to rise by 0.4 percent.

The unexpected dip by GDP primarily reflected an increase in imports, which are a subtraction in the calculation of GDP.

A decrease in government spending also weighed on GDP, while increases in investment, consumer spending and exports helped limit the downside.

Payroll processor ADP also released a report this morning showing private sector employment in the U.S. increased by much less than expected in the month of April.

ADP said private sector employment climbed by 62,000 jobs in April after surging by a downwardly revised 147,000 jobs in March.

Economists had expected private sector employment to jump by 125,000 jobs compared to the addition of 155,000 jobs originally reported for the previous month.

Shortly after the start of trading, the Commerce Department is due to release its report on personal income and spending in the month of March. The report includes the Federal Reserve's preferred readings on consumer price inflation.

Personal income is expected to rise by 0.4 percent and personal spending is expected to climb by 0.6 percent, while consumer prices are expected to come in unchanged and core consumer prices, which exclude food and energy prices, are expected to inch up by 0.1 percent.

After showing a lack of direction early in the session, stocks moved mostly higher over the course of the trading day on Tuesday. With the upward move, the S&P 500 closed higher for the sixth straight session, reaching its best closing level in almost a month.

The major averages ended the day off their highs of the session but still firmly positive. The Dow jumped 300.03 points or 0.8 percent to 40,527.62, the S&P 500 climbed 32.08 points or 0.6 percent to 5,560.83 and the Nasdaq rose 95.18 points or 0.6 percent to 17,461.32.

In overseas trading, stock markets across the Asia-Pacific region turned in another mixed performance during trading on Wednesday. Japan's Nikkei 225 Index advanced by 0.6 percent, while China's Shanghai Composite Index dipped by 0.2 percent.

Meanwhile, the major European markets have all moved to the upside on the day. While the French CAC 40 Index is up by 0.4 percent, the German DAX Index is up by 0.3 percent and the U.K.'s FTSE 100 Index is up by 0.1 percent.

In commodities trading, crude oil futures are sliding $0.63 to $59.79 a barrel after plunging $1.63 to $60.42 a barrel on Tuesday. Meanwhile, an ounce of gold is trading at $3,299.80, down $33.80 compared to the previous session's close of $3,333.60. On Tuesday, gold fell $14.10.

On the currency front, the U.S. dollar is trading at 142.97 yen compared to the 142.33 yen it fetched at the close of New York trading on Tuesday. Against the euro, the dollar is trading at $1.1369 compared to yesterday's $1.1387.