Wednesday, April 30, 2025
Pre-market futures are down this morning, following economic data released ahead of today’s opening bell. We had been flat on the Dow and S&P 500 prior to these releases, with the Nasdaq down around -100 points. At this hour, all three major indexes are firmly in the red. Bond yields, meanwhile, are ticking up a few basis points (bps).
ADP Private-Sector Payrolls Shrink to +62K
Jobs Week continues this morning, with private-sector payrolls for April from
Automatic Data Processing ADP. Results came in roughly half of expectations: 62K versus the consensus 120K. The previous month was revised lower by 8000 private-sector jobs to 147K. Today’s headline is the lowest since July of last year.
Goods-producing jobs weren’t horrid: 26K; it was Services’ mere 34K that was lagging for this past month. Non-farm payroll estimates for Friday morning is currently +133K, likely with a down arrow this morning. Medium-sized companies (between 50-499 employees) filled the most positions at +40K for April; small firms came in at +11K and large businesses only +12K.
Leisure and Hospitality jobs led by sector, +27K. This was followed by Trade/Transportation/Utilities at +21K and Financial positions at +20K. Construction brought +16K new private-sector jobs. But Education & Healthcare — often one of the sector leaders month by month — was negative -23K in this latest report.
Job Stayers averaged making +4.5% higher salaries for the month, down 10 bps. Job Changers, which had been slowing over the past few years, ticked up 20 bps to +6.9%. “Unease is the word of the day,” ADP Chief Economist Nela Richardson was quoted this morning. The question right now is: was April 2025 a one-off dip a la July 2024, or is this a sign of the labor force in months to come?
First Q1 GDP -0.3%, Pricing Index Higher
Ahead of the pending Personal Consumption Expenditures (PCE) for March, which come out after today’s opening bell, we see the first prints on
Q1 Gross Domestic Product (GDP),
Consumption,
Pricing and
Employment Cost Indexes ahead of the open. Q1 GDP notched its first negative headline in more than three years: -0.3%. This is down from the +0.4% expected and Q4’s final correction to +2.4%.
Consumption was hotter than expected at +1.8% for March, versus +0.4% anticipated and +4% from the final Q4 print. Nevertheless, this is the lightest read since Q2 of 2023. The Pricing Index, year over year, reached +3.7%, 50 bps higher than projected. Core Pricing reached +3.5% — nearly a full percentage point above last quarter’s tally. Q1 Employment Costs came in at +0.9%, exactly in-line with estimates and the last look at Q4.
Keep in mind these are March numbers, and it makes sense that pre-market futures have dropped from flat-to-down ahead of these prints to -301 points on the Dow, -61 on the S&P 500 and -337 points on the Nasdaq. Dwindling growth and job hires meeting up with rising or steady pricing and employment costs are not a recipe for a strengthening economy. That said, all this economic data is subject to future revisions.
What to Expect from the Stock Market Today
The full March
PCE report comes out after the opening bell today, expected to be flat month over month (followed by +0.3% reported the previous month). Year over year, +2.2% is the estimate, down 30 bps from the prior month’s headline. Core PCE year over year is expected -20 bps lower that the previous read to +2.6%.
Pending Home Sales, also for March, are expected to have grown +1%. The prior print saw +2% growth in this metric. Recall last week’s New Home Sales surprised to the upside — either giving hope to the flagging housing market or considered a temporary respite, depending on which economic you talk to.
Q1 earnings for
Microsoft MSFT and
Meta Platforms META — two of the so-called “Magnificent 7” stocks of last year — will be reported after the bell today. Microsoft is expected to glean +8.8% on earnings per share (EPS) growth on +10.5% higher revenues, while Meta’s EPS is projected up +10.8% and revenues +13%.
Check out the updated Zacks Earnings Calendar here.Questions or comments about this article and/or author? Click here>>
Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report
Microsoft Corporation (MSFT): Free Stock Analysis Report Automatic Data Processing, Inc. (ADP): Free Stock Analysis Report Meta Platforms, Inc. (META): Free Stock Analysis ReportThis article originally published on Zacks Investment Research (zacks.com).
Zacks Investment Research
