The Dow Jones Industrial Average slipped on Wednesday after private sector hiring hit its lowest level in more than two years, raising concerns trade policy uncertainty could be weighing on the U.S. economy.
The 30-stock Dow lost 91.90 points, or 0.22%, ending at 42,427.74. The blue-chip average snapped a four-day winning run. The S&P 500 advanced 0.01% and closed at 5,970.81, while the Nasdaq Composite rose 0.32% and settled at 19,460.49.
A report from payrolls processing firm ADP showed that payrolls increased only 37,000 for the month, less than the downwardly revised 60,000 in April and below the consensus forecast of 110,000 that economists polled by Dow Jones were expecting.
The report casts a pall over Friday’s all-important government nonfarm payrolls report, which economists currently expect to show an increase of 125,000 jobs for May, according to a Dow Jones survey.
President Donald Trump blasted Federal Reserve Chairman Jerome Powell right after those numbers came out, saying “Too Late Powell” should cut rates.
Even with the “volatile” ADP report and tariff overhangs, Mike Dickson of Horizon Investments told CNBC that “things are probably better than feared.”
“I think the ADP report has had the history of being quite noisy, so I think we’re just going to have to wait and see about Friday as it relates to the labor market,” the firm’s head of research and quantitative strategies said. “Recent inflation data has been pretty tame and healthy in the right direction.”
That said, he still thinks the market is range-bound in the near term, adding that “we’re entering into a little bit of a lull” in terms of market catalysts for the next month.
Wall Street is coming off a solid stretch with strong gains in tech stocks allowing investors to look past any worries about tariffs or the economy. The 30-stock Dow rose more than 200 points, or 0.5%, on Tuesday.
The recent gains have investors increasingly confident stocks have turned a corner on tariffs, especially after a series of reversals from Trump convinced traders the White House is mainly wielding high levies as a negotiating tool. A federal court striking down the president’s tariffs just last week added to hopes the market has priced in the worst of the duties, though they were later reinstated temporarily by an appeals court.
Trump posted earlier Wednesday that dealing with Chinese President Xi Jinping has been “extremely hard.”
Dow closes lower on Wednesday
The Dow Jones Industrial Average finished Wednesday’s session in the red.
The 30-stock blue-chip index dropped 91.90 points, or 0.22%, to end at 42,427.74. Meanwhile, the S&P 500 and Nasdaq Composite closed higher. The broad market index ticked up by 0.01%, settling at 5,970.81, while the tech-heavy Nasdaq advanced 0.32% to close at 19,460.49.
— Sean Conlon
Investors should seek durable growth for equity upside, UBS says
Investors can find equity upside if they focus on companies that show promising signs of durable growth in transformational innovation, according to UBS.
“Market swings can be expected, as investor sentiment remains susceptible to fresh trade and economic headlines. However, we have also consistently highlighted that intact secular trends should continue to support equity gains,” the firm wrote in a Tuesday note. “Innovation remains a key driver of long-term equity performance, and recent developments underscore our strong conviction in the potential of our Transformational Innovation Opportunities, including Artificial intelligence, Power and resources, and Longevity.”
AI looks especially promising, as momentum in the field looks set to continue growing on strong demand.
“While chip-related controls amid intensifying U.S.-China tech rivalry could weigh on investor sentiment in the near term, markets are likely to return to fundamentals, which remain supportive,” the bank added.
Meanwhile, power and resources companies could benefit on accelerating demand for electricity. Health care could also return opportunities as human lifespans increase.
— Lisa Kailai Han
10-year Treasury yield falls to lowest since early May
The U.S. 10-year Treasury yield hit a low of 4.349% on Wednesday, its lowest level going back to May 9 when the bond yield fell to 4.343%.
— Sarah Min, Nick Wells
Energy stocks drag
Energy stocks lagged in Wednesday’s session.
The S&P 500 sector fell 1.7% in afternoon trading. By comparison, the broad index as a whole ticked 0.3% higher.
Valero Energy and Phillips 66 led the sector lower with a decline of more than 3% each. Every stock in the sector was on track to finish Wednesday’s session in the red.
The sector has dropped around 5% in 2025.
— Alex Harring
Dalio warns against trying to lower interest rates ‘unnaturally’
Bridgewater founder Ray Dalio said on “Squawk on the Street” that the U.S. government debt situation is “urgent” but that lowering interest rates will not necessarily help ease the situation.
“You can’t unnaturally lower interest rates without a negative consequence. … You don’t get richer by lower interest rates or printing money,” Dalio said.
One of the consequences of higher Treasury yields is that new debt issued by the U.S. government has higher annual payments than the bonds issued during low-yield periods.
Dalio also said that we are moving into a period of “greater than normal risk” and that investors should have a diversified portfolio while generally de-emphasizing debt assets. That could include 10% to 15% of a portfolio in gold, Dalio said.
“I think it’s going to be a good asset, but it also is a diversifying asset,” he added about gold.
The hedge fund manager is currently promoting his new book titled “How Countries Go Broke: The Big Cycle”
— Jesse Pound
Stocks making the biggest moves midday
Check out some of the companies making headlines in midday trading:
- CrowdStrike — The cybersecurity stock was down nearly 7% after the company’s revenue forecast for the current quarter undershot analyst estimates. CrowdStrike said it expects revenue in the range of $1.14 billion to $1.15 billion, while analysts polled by LSEG were looking for $1.16 billion.
- Dollar Tree — The discount retailer slid 7%. Dollar Tree said adjusted earnings per share could see a pullback of as much as 50% in the current quarter on a year-over-year basis, while analysts polled by FactSet expected a 1.8% decline. The firm cited pressure from President Donald Trump’s tariffs as one of the headwinds affecting its earnings forecast.
- Thor Industries — Shares advanced 3% on the heels of better-than-expected third-quarter results. The recreational vehicle maker posted earnings of $2.53 per share on revenue of $2.89 billion, compared to the forecast $1.79 per share and $2.61 billion from analysts surveyed by FactSet.
Read the full list here.
— Brian Evans
Bank of America, Morgan Stanley now see at least 15% upside for Wells Fargo
Wells Fargo has room for growth now that it is no longer constrained by the Federal Reserve’s asset cap, according to both Morgan Stanley and Bank of America.
On Tuesday, the central bank released Wells Fargo from the seven-year-long $1.97 trillion cap on its assets. Following the move, Morgan Stanley reiterated its overweight rating and bumped up its price target from $77 to $87, suggesting 15% upside from Tuesday’s close.
“We expect release from the asset cap will spur a multi-year period of growth as Wells seeks to regain its 2.2% points of lost market share in US deposits and 3.3% points of market share in loans since 2017,” analyst Betsy Graseck wrote in a note Wednesday. “Expect additional lending opportunities as they arise and fit Wells’ risk/return profile.”
Bank of America also reiterated its buy rating and raised its price target to $90 from $83, implying 19% upside from Friday’s close. The bank said it sees no reason Wells Fargo shouldn’t earn best-in-class returns and believes investor focus should now shift to management’s ability to deliver return on tangible common equity in the high teens.
“We see potential for a new pool of investors who had been fatigued by the regulatory overhang to step-in given WFC’s idiosyncratic growth story, room for efficiency gains in the consumer bank and potential for capital relief,” analyst Ebrahim H. Poonawala wrote in a note Tuesday.
— Michelle Fox
18 stocks hit new 52-week highs
A Netflix building in Los Angeles, California, US, on Thursday, Oct. 3, 2024.
Eighteen stocks in the S&P 500 scored fresh 52-week highs during Wednesday’s session, with 12 of those securing new all-time highs. Below are some of the stocks that hit that milestone:
- Netflix trading at all-time high levels back to its IPO in May 2002
- Nasdaq trading at all-time high levels back to April 2003
- Visa trading at all-time high levels since its IPO in March 2008
- Axon Enterprise trading at all-time highs back to when TASER began trading in May 2001
- Cintas trading at all-time high levels back to its IPO in 1983
- Amphenol trading at all-time high levels since its IPO in 1991
- Broadcom trading at all-time high levels back through Avago history and its IPO in August 2009
- Seagate trading at all-time highs back to its IPO in Dec, 2002
- Corteva trading at all-time highs back to its spin-off from DowDuPont on May 24, 2019
— Sean Conlon, Christopher Hayes
ISM services measure shows activity weakened in May
The U.S. services sector unexpectedly weakened in May amid growing worries about slowing economic growth, inflation and tariffs, according to the Institute for Supply Management.
The ISM services index fell to 49.9% on the month, just below the expansion/contraction line and short of the Dow Jones consensus estimate for 52.1%. April’s reading was 51.6%.
Internally, the survey saw substantial declines in new orders, production, inventories and order backlogs, offset somewhat by increases in imports and a small gain in the employment outlook. Respondent commentary focused on tariffs and government budget cuts, though several sectors reported strong activity.
Stocks shed gains after the report while Treasury yields fell.
— Jeff Cox
Chase customer spending growth slowed in May
Customers use a Chase bank ATM on April 11, 2025 in Miami, Florida.
Consumer spending weakened in May, according to Chase spending data shared in a note by JPMorgan analyst Richard Shane.
“Total spending growth for May ticked down m/m. Total spending growth fell to ~1.8% as of May 27, below the April figure of ~2.8%. As we look across the data set, it appears that spending growth is modestly eroding,” Shane said.
Spending is still up about 3% year to date, but that has slumped in recent weeks.
“In the most recent 30 days, there were 4 days where spending was more than 15 [basis points] above the YTD average and 20 days where spending was at least 15bps below the YTD average,” Shane said. The Chase date is through May 27, and a basis point is equal to 0.01%.
On the positive side, the weaker spending growth could be partly a reflection of lower gas prices, Shane said.
— Jesse Pound
Stocks open in the green
Traders work on the floor of the New York Stock Exchange on June 3, 2025.
Stocks traded higher on Wednesday.
The Dow Jones Industrial Average gained 53 points, or 0.1%, just after the opening bell. The S&P 500 advanced 0.2%, while the Nasdaq Composite climbed about 0.3%.
— Sean Conlon
South Korean ETF looks to open at new high for the year following presidential election results
South Korean stocks climbed in early trading in the U.S. on Wednesday as investors cheered the results of a decisive presidential election, which saw the country’s opposition party leader, Lee Jae-myung, win out over conservative candidate Kim Moon Soo.
The iShares MSCI South Korea ETF (EWY) rose almost 3% in the premarket, placing the fund on pace to open at its highest level since October 2024. The fund’s year-to-date intraday high is currently 62.11.
The fund is also on track for its fourth straight weekly gain for the first time since January.
— Nick Wells, Sean Conlon
Trump’s steel and aluminum tariffs are in effect
US President Donald Trump speaks during a visit to US Steel – Irvin Works in West Mifflin, Pennsylvania, May 30, 2025.
President Donald Trump’s 50% tariffs on steel and aluminum imports coming into the U.S. took effect early Wednesday.
This comes after the president announced the order doubling tariffs on all metal imports to 50% from 25% last week. He then signed it Tuesday, with the order saying that the raised tariffs “will more effectively counter foreign countries that continue to offload low-priced, excess steel and aluminum” in the U.S.
Trump also stated that the U.K. needed “different treatment” due to the U.S.-U.K. trade deal that was unveiled on May 8, temporarily exempting it from the tariff increase. However, a 25% levy remains in place for the U.K. while details of the recent trade deal are figured out.
— Holly Ellyatt, Sean Conlon
Wedbush, Dan Ives launch new ETF focused on AI plays
The Dan Ives Wedbush AI Revolution ETF is set to begin trading on Wednesday under the ticker “IVES.” The fund follows an index that is based on the best artificial intelligence stock ideas surfaced by Ives’ research.
The fund includes some of the biggest names in tech, such as Nvidia, as well as some smaller AI plays. The holdings will change over time as the AI boom evolves, Ives told CNBC.
“The AI revolution theme is now going from semis to software, to infrastructure, to consumer and the other derivatives,” Ives said.
— Jesse Pound
See the stocks moving before the bell
These are some of the stocks moving before the bell on Wednesday:
- Dollar Tree — The budget retailer slid 3.9% after the company said earnings per share could plunge between 45% and 50% in the current quarter, due in part to cost pressures from tariffs. Analysts polled by FactSet expected per-share earnings to slide 1.8%.
- Thor Industries — The RV maker jumped 11.6% after posting better-than-expected earnings for the third fiscal quarter and reaffirming full-year guidance. Thor earned $2.53 per share on $2.89 billion, while analysts surveyed by FactSet anticipated $1.79 per share and $2.61 billion billion.
- Wells Fargo — The bank stock rose 2.5% after the Federal Reserve removed the asset cap on Wells Fargo. The cap dated back to 2018 and limited the firm’s growth while it revamped its governance and risk management following several controversies.
Click here to read the full list.
— Alex Harring
Private sector job creation slows in May
Attendees at a job and resource fair hosted by the Asheville Area Chamber of Commerce in partnership with NCWorks in Fletcher, North Carolina, US, on Wednesday, April 9, 2025.
Private sector job creation hit its lowest level in more than two years in May, payrolls processing firm ADP reported on Wednesday.
Payrolls increased 37,000 during the period, lower than the downwardly revised 60,000 in April and the Dow Jones estimate of 110,000.
That marked the lowest monthly job total since March 2023.
— Jeff Cox
Bank of America downgrades CrowdStrike to neutral rating from buy
In a Wednesday note, Bank of America downgraded security software maker CrowdStrike to a neutral rating from buy.
Shares of CrowdStrike have rallied 43% this year, but were last trading 7% lower in extended trading after issuing a weaker-than-expected revenue forecast. However, the company beat on analysts’ top- and bottom-line expectations in its fiscal first quarter.
Despite its downgrade, Bank of America raised its price objective to $470 from $420 “to reflect recent sector multiple expansion.” This revised forecast implies a downside of nearly 4% from CrowdStrike’s Tuesday closing price of $488.76.
“We favor CrowdStrike’s fundamentals and growth prospects, but believe the valuation leaves only limited upside from the current level,” wrote Bank of America analyst Tal Liani.
Going forward, the analyst expects CrowdStrike’s growth to decelerate.
“2Q revenue growth guidance of 19% was 130bps below the Street, related to CCP impact and amortization of partners program. Management is expecting growth to accelerate by 300bps in 2H, but on an annual basis, we expect growth to decelerate from 21% in ’25 to 18% in ’27,” he continued.
— Lisa Kailai Han
Needham downgrades Apple to hold rating from buy
A person looks at iPhones in the Apple Fifth Avenue store in New York City, U.S., May 23, 2025.
Needham gave Apple a rare downgrade, citing the iPhone maker’s expensive valuation.
“We move to the sidelines for AAPL owing to its expensive relative valuation, increasing fundamental growth headwinds, and rising competitive threats,” wrote analyst Laura Martin. “We believe that, for AAPL shares to work, they must have the catalyst of an iPhone replacement cycle, which we do not foresee in the next 12 months. Until then, we believe that $170-$180/share is a better entry level for AAPL shares.”
Martin especially pointed to Meta Platforms and Google as two of Apple’s most critical big tech competitors.
CNBC Pro subscribers can read the full story here.
— Lisa Kailai Han
South Korean stocks rise 2% to lead gains in Asia after opposition leader wins presidential election
Asia-Pacific markets advanced Wednesday after Wall Street rose on the back of a tech rally, led by chipmaker Nvidia, with South Korean stocks leading gains.
South Korean markets rose as opposition party leader Lee Jae-myung won the presidential election. The Kospi index popped 2.66% to end the day at 2,770.84, hitting its highest level since August last year, while the small-cap Kosdaq advanced 1.34% to 750.21.
Meanwhile, Chinese and Hong Kong markets were little changed after U.S. President Donald Trump commented that it was ‘extremely hard’ to strike a deal with his counterpart Xi Jinping, as a trade stalemate fueled calls for the leaders to talk.
Mainland China’s CSI 300 index moved up 0.43% to close at 3,868.74, while Hong Kong’s Hang Seng Index added 0.6% to 23,654.03.
In Japan, the benchmark Nikkei 225 climbed 0.8% to end the day at 37,747.45, while the broader Topix index rose 0.51% to 2,785.13.
Australia’s S&P/ASX 200 ended the day 0.89% higher at 8,541.80. The country’s economy grew 1.3% year-on-year in the first quarter of 2025, lower than the estimated 1.5% growth among economists polled by Reuters. The latest reading was unchanged from the previous quarter’s 1.3% year-on-year growth.
Meanwhile, India’s benchmark Nifty 50 and the BSE Sensex each advanced 0.29% as of 2 p.m. Indian Standard Time.
— Amala Balakrishner
Stocks making the biggest moves after hours
Check out the companies making headlines after hours.
Hewlett Packard Enterprise — Shares rose 3% after the information technology company beat analysts’ expectations on the top and bottom lines. Hewlett Packard Enterprise reported second-quarter adjusted earnings of 38 cents per share on revenue of $7.63 billion. Analysts polled by LSEG had expected earnings of 32 cents per share on revenue of $7.45 billion.
CrowdStrike Holdings — The stock dropped more than 6% after the cybersecurity company posted soft revenue guidance for the current quarter. The company called for $1.14 billion to $1.15 billion in revenue, while analysts polled by LSEG sought $1.16 billion.
Read the full list here.
— Sarah Min
Stock futures open little changed
Stock futures opened little changed Tuesday night.
Dow Jones Industrial Average futures dipped by 4 points, or 0.01%. S&P 500 futures were flat, and Nasdaq 100 futures dipped 0.04%.
— Sarah Min