Stocks Open Lower After Private Payrolls Unexpectedly Decline in November, Report Microsoft Cutting AI Software Sales Quotas

Stocks opened lower Wednesday after a poor private-payrolls reading and a report that Microsoft is cutting AI software sales quotas. 

The tech-heavy Nasdaq, benchmark S&P 500, blue-chip Dow Jones Industrial Average, and opened down 0.4%, 0.2%, and less than 0.1%, respectively. Yesterday, the three major stock indexes rose for the sixth time in seven sessions.

Before the bell, the ADP employment reading for November indicated that private payrolls fell by 32,000 last month when an increase of 40,000 jobs was expected, with small businesses particularly hit hard. The report is the last month jobs reading for the Federal Reserve before its meeting on interest rates next week. The CME FedWatch tool points to an 89% likelihood the Fed will cut rates by a quarter-percentage point.

In addition, The Information reported that Microsoft (MSFT) is lowering AI software sales quotas “as customers resist newer products.” Shares of the tech giant declined 2% at the open.

The other Magnificent Seven large-cap technology stocks were mixed, with shares of Nvidia (NVDA), the world’s most valuable company, down 0.5% after having recorded gains the first two days this week.

Shares of Boeing (BA) and Intel (INTC), which were the top gainers in the S&P 500 yesterday with roughly 10% and 9% surges, were down 1.5% and 0.5%, respectively.

In post-earnings moves, American Eagle Outfitters (AEO) soared 12%, Marvell Technology (MRVL) jumped 8%, GitLab (GTLB) dropped 15%, CrowdStrike (CRWD) declined 4%, and Macy’s (M) slipped 2%. Salesforce (CRM) edged higher ahead of its results after the closing bell.

Bitcoin was trading around $92,600, up from its overnight low of around $91,000. Yesterday, the largest cryptocurrency rallied from below $85,500 after having suffered its worst day since March on Monday.

The yield on the 10-year Treasury note slipped to 4.07% from 4.09% at Tuesday’s close. The U.S. dollar index, which tracks the performance of the dollar against a basket of foreign currencies, fell 0.4% to 98.99.

WTI crude futures, the U.S. oil benchmark, rose 0.8% to $59.10 per barrel, and gold futures were 0.8% higher at $4,255 per ounce.