Sept 4th 2014 – US Stocks End Lower Despite ECB Stimulus Plan

Market View:

The ECB did surprise most people by cutting its rate again and starting a stimulus programme, although not as aggressive as the US Quantitative Easing programmes, it’s still a plan to boost growth in the Euro zone.

The market initially cheered the news with the indexes hitting intraday all-time highs again, only to slowly sell off the rest of the day.

I am going to assume that this was profit taking from the recent run up and possibly caused by caution around the employment report tomorrow.  That is 3 days in a row that the S&P 500 has actually closed lower, so I expect a bounce tomorrow, but it may depend on a decent report or at least matching the expectations of Wall Street.

Market News:

U.S. stocks erased record-setting gains on Thursday, turning lower in a late-session shift as cheer over the European Central Bank’s unexpected rate cut faded, a day ahead of the monthly payrolls report.

The ECB lowered its benchmark interest rate to 0.05 percent, and cut its deposit facility to minus 0.2 percent.

After extending its record run to an all-time high, the S&P 500 slid 3.07 points, or 0.2 percent, to 1,997.65, with energy leading losses among its 10 major sectors.

Stock futures had held gains after the August ADP employment report found the private sector added 204,000 jobs last month. Separately, the government reported 302,000 jobless claims were filed last week.

Another report had the U.S. trade deficit narrowing in July to a six-month low as exports rose to a record.

Friday:

8:30 a.m. Eastern: Nonfarm payrolls for August

8:30 a.m.: Unemployment rate for August

News Sources:  CNN Money & CNBC