Stocks little changed ahead of jobs report

[July 02, 2010]  NEW YORK (AP) -- Stock futures were little changed Friday as investors avoid making any big moves ahead of the government's key monthly employment report.

Pessimism has been growing among investors in recent days about the health of the jobs market and economy as a whole. Major indexes have fallen two straight days after disappointing reports on hiring by private employers and weekly jobless claims.

Traders are concerned that the pace of the economic recovery is not as quick as they had once hoped. That's primarily because of a weak labor market. High unemployment has kept consumers' confidence low and retail sales from growing rapidly. Consumer spending accounts for the largest portion of the nation's economic activity. Until employers accelerate the pace of hiring, the economy is expected to grow only modestly.

The government's June employment report, due out at 8:30 a.m. EDT, is expected to again show little improvement. Economists polled by Thomson Reuters forecast employers cut 110,000 jobs last month. However, that number will likely be skewed by the government laying off temporary workers hired to conduct the 2010 census. Economists expect the government cut 240,000 census jobs in June.

Because of the census worker jobs, traders will be looking to see whether hiring by private employers accelerated last month. Economists expect private employers added 112,000 jobs last month. If actual results fall short of that forecast, stocks are likely to fall because it will add to the concerns that strong economic growth is still not close.

Ahead of the opening bell, Dow Jones industrial average futures fell 1, or less than 0.1 percent, to 9,661. Standard & Poor's 500 index futures were unchanged at 1,021.80, while Nasdaq 100 index futures rose 4.50, or 0.3 percent, to 1,732.50.

Stocks were hit hard last month after the Labor Department's employment report was released because private employers did not hire as many people in May as was forecast.

On Wednesday, major indexes fell when payroll company ADP said private employers didn't add as many jobs in June as was forecast either. The ADP report is often considered a guide for the government's monthly jobs report. So disappointment in the ADP report Wednesday added to worries about how the government's report will shape up Friday.

Major indexes also dropped Thursday after the Labor Department's weekly report on jobless claims showed an unexpected jump in workers filing for benefits for the first time.

Meanwhile, with investors tentative about a recovery bond prices rose slightly Friday. The yield on the benchmark 10-year Treasury note, which moves opposite its price, fell to 2.94 percent from 2.95 percent late Thursday.

Overseas, Britain's FTSE 100 rose 0.4 percent, Germany's DAX index gained 0.2 percent, and France's CAC-40 rose 0.1 percent. Japan's Nikkei stock average rose 0.1 percent.

[Associated Press; By STEPHEN BERNARD]

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