Stocks spent a second day in the red, carrying over a sharp decline in futures Tuesday night, while crude oil climbed back above $US50 a barrel.
First, the scoreboard:
- Dow: 17,702.42 -73.70 (-0.41%)
- S&P 500: 2,055.80 -12.09 (-0.58%)
- Nasdaq: 4,862.05 -38.84 (-0.79%)
And now, the top stories on Wednesday:
- GoDaddy opened 30% higher than its initial public offering price of $US20 per share at its trading debut. The web hosting site is now has a market cap of over $US6 billion. On Tuesday, Briefing’s Dennis Hobein noted that the company is unprofitable and in a mountain of debt.
- McDonald’s will boost some 90,000 workers’ pay by more than 10%, adding benefits including paid vacation. It will pay at least $US1 per hour more than local minimum wages, raising the hourly wage to $US9.90 on July 1, and to over $US10 by the end of 2016, according to the Wall Street Journal. The company’s current rate is $US9.01. Several analysts are saying solid US wage growth is finally here. Around the world, fast food workers have protested for better wages.
- West Texas Intermediate crude futures rose by more than 4% to as high as $US50.45 per barrel. Data from the Energy Information Administration showed that US crude inventories rose last week by 4.8 million barrels, bringing the total US stockpile to 471.4 million. The spike also coincided with reports of an explosion at an oil platform in the Gulf of Mexico owned by Mexican state-run oil company Pemex, which claimed four lives.
- The ADP private payrolls report showed 189,000 jobs were added in March, missing the expectation of 225,000. It was the first reading below 200,000 since last January.
- In manufacturing data, the latest reading from Markit came in at 55.7, beating the expectation for a 55.3 print. And, the latest Purchasing Managers’ Index from the Institute of Supply Management came in at 51.5, missing the forecast of 52.5.
- The pace of US auto sales jumped to an annualized rate of 17.05 million units in March. This was up from 16.16 million in February, and it stronger than the 16.90 million analysts had expected. Toyota saw the biggest gains, as sales climbed 4.9% versus 4.4% estimated.
- Some energy companies were dreading April. Banks will recalculate the value of their loans this month and possibly slash credit lines due to the oil crash and the consequent tumble in the value of their collateralized assets, Bloomberg reported. As much as 30% of credit may be reduced.