US stocks were mixed on Wednesday, with reports with weak private pay and a careful economic outlook from the Fed's beige book fostering concerns about growth, inflation and tariffs.
The Dow Jones Industrial Average snapped a four-day winning steak, closing 91.90 points (0.22%). The S&P 500 was almost flat, but Nasdaq's composites rose 0.32% to close at 19,460.49.
Sentiment from Wednesday's stock trading session was hit by a weaker ADP employment report than expected. This showed that private pay increased by just 37,000 in May, especially below estimates. Reading comes ahead of Friday's non-farm pay data, and could force the Federal Reserve to cut interest rates.
In 2010, the Treasury yield fell to 4.349%, the lowest since early May.
The Fed's beige book is flagging against growing weaker and rising price pressure.
It further clouded the outlook for the economy, a beige book from the Federal Reserve released Wednesday morning, and reported a “slight decline” in US economic activity over the past six weeks. Employment activities remained largely flat as employers postponed expansion plans due to rising policy uncertainty from Washington and tariff-related cost pressures.
“All districts have reported an increase in levels of economic and policy uncertainty,” the Fed said. The report also cited “an extensive report of contacts who hope that costs and prices will rise at a faster rate in the future.”
The beige book, which rose from 107 in April, mentioned tariffs 122 times.
Companies in several regions, including New York and Philadelphia, reported rising input costs. Some companies expect to see a lower profit margin or pass additional costs to consumers to manage input spikes.
Boston, New York and Philadelphia had reduced activity. However, areas like Richmond, Atlanta and Chicago reported modest growth. Overall, the Fed found that employment activities were cautious, even in stronger districts.
