Stocks set for lackluster start to June

June 1, 2011: 9:06 AM ET
premarkets

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NEW YORK(CNNMoney) -- May went out with a bang but June is headed for a sluggish start, with U.S. stock futures barely changed ahead of the opening bell.

Investors are digesting the latest reports on the state of the U.S. job market, and awaiting a couple of reports about manufacturing in the United States. Earlier, manufacturing reports from China and the U.K. signaled a slowdown in the pace of growth.

Dow Jones industrial average (INDU), S&P 500 (SPX) and Nasdaq (COMP) futures were slightly lower ahead of the opening bell. Futures measure current index values against perceived future performance.

The rally in U.S. stocks regained momentum Tuesday afternoon, but the day's gains weren't enough to lift the market out of the red for the month.

The market's performance in May was the worst since August 2010. The Dow tumbled nearly 2% for the month, while the S&P 500 and the Nasdaq lost 1.3% as investors wrestled with signs of a slower economic recovery.

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Economy: The first of this week's jobs-related economic reports showed that the pace of planned job cuts edged higher in May, according to a report from outplacement consulting firm Challenger, Gray & Christmas.

A separate report, also released Wednesday morning, by ADP showed private-sector payrolls added a modest 38,000 jobs in May. The number falls well below the 170,000 private sector jobs economists were expecting, according to an estimate from Briefing.com.

Both sets of data are typically used to forecast the government's monthly jobs data due Friday, which is likely "the most important of the week," said Michael Koskuba, portfolio manager with Victory Capital Management.

A CNNMoney survey of 24 economists expect the government's jobs report to show a total gain of 176,000 jobs, and a private sector gain of 193,000, while the unemployment rate edges back down to 8.9%.

At 10 a.m. ET, the Institute for Supply Management will release its May manufacturing index, and the Commerce Department will issue its April construction spending report.

The ISM Index is expected to slip to 57.6 from April's reading of 60.4, while construction spending is expected to decrease 0.5%.

Major auto manufacturers also release their May sales figures on Wednesday, starting at 11 a.m. ET.

Companies: Shares of Finnish mobile phone giant Nokia (NOK) fell 9.5% in premarket trade. Nokia issued a sales warning Tuesday saying it expects device sales to come in "substantially below" its quarterly estimates. Company shares plunged 14% in the previous session.

World markets: European stocks jumped Tuesday amid speculation the European Union could provide additional aid for Greece. That investor optimism spilled into U.S. stocks, too, on Tuesday.

But by Wednesday, "the froth is off," Koskuba said, and investors are focused on exactly what form and how any Greek bailout would happen.

European stocks were nearly flat in mid-day trading. Britain's FTSE 100 and France's CAC 40 were little changed, while the DAX in Germany shaved 0.1%.

The United Kingdom's manufacturing sector also signaled weakness. While the sector did continue to expand, it grew at the slowest rate since September of 2009.

And while China's manufacturing sector continued to expand, the most recent data showed that it expanded at the slowest rate in 10-months.

Investors are watching the Asian giant closely: "There is this potential slowdown in China," Koskuba said.

Asian markets ended the session mixed. The Shanghai Composite finished the session flat, while the Hang Seng in Hong Kong lost 0.2% and Japan's Nikkei ticked up 0.3%.

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Currencies and commodities: The dollar was lower against the euro and the Japanese yen, but gained versus the British pound.

Oil for July delivery slipped 65 cents to $102.05 a barrel.

Gold futures for August delivery rose $1.5 to $1,538.30 an ounce.

Bonds: The price on the benchmark 10-year U.S. Treasury rose, with the yield dipping to 3.02%.  To top of page

Index Last Change % Change
Dow 32,627.97 -234.33 -0.71%
Nasdaq 13,215.24 99.07 0.76%
S&P 500 3,913.10 -2.36 -0.06%
Treasuries 1.73 0.00 0.12%
Data as of 6:29am ET
Company Price Change % Change
Ford Motor Co 8.29 0.05 0.61%
Advanced Micro Devic... 54.59 0.70 1.30%
Cisco Systems Inc 47.49 -2.44 -4.89%
General Electric Co 13.00 -0.16 -1.22%
Kraft Heinz Co 27.84 -2.20 -7.32%
Data as of 2:44pm ET
Overnight Avg Rate Latest Change Last Week
30 yr fixed3.80%3.88%
15 yr fixed3.20%3.23%
5/1 ARM3.84%3.88%
30 yr refi3.82%3.93%
15 yr refi3.20%3.23%
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