ADP jobs data adds to economic uncertainty gripping markets
The Labor Department's benchmark February jobs report is due later this week.
The U.S. economy saw a notable softening private-sector job creation last month, data indicated Wednesday, suggesting tariff uncertainty and a pullback in consumer sentiment is having an impact on hiring into the early months of the new Trump administration.
Payroll-processing group ADP said around 77,000 jobs were created in the private sector last month, the lowest tally since Julye a sharp pullback from the upwardly-revised tally of 186,000 in January. Economists had expected ADP's National Employment Report to show gains of around 141,000 as hiring slowed into the middle of the first quarter.
Investors are also likely to focus on wage and earnings details provided in the ADP release, which showed a slowing year-on-year increase of 4.7% for so-called job stayers. Those seeking new roles saw pay gains of 6.7%, the lowest wage premium for changing jobs in more than three years.
“Policy uncertainty and a slowdown in consumer spending might have led to layoffs or a slowdown in hiring last month,” said ADP's chief economist Nela Richardson, chief economist. “Our data, combined with other recent indicators, suggests a hiring hesitancy among employers as they assess the economic climate ahead.” 
Stock futures pared gains in the wake of the ADP release, with the S&P 500 called 10 points higher and the Nasdaq set for an 80-point advance at the start of trading. The Dow is priced for a 35-point gain.
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Benchmark 10-year Treasury note yields held steady at 4.235% following the release, while 2-year notes were last pegged at 3.937% following their biggest two-day pullback of the year.
The U.S. dollar index, which tracks the greenback against a basket of six global currencies, was marked 0.60% lower 105.106, the lowest since early December.
More Economic Analysis:
- U.S. consumers are wilting under renewed stagflation risks
- Jobs reports provide critical look at economy, could roil markets
- Fed inflation gauge indicates big changes in key economic driver
The CME Group's FedWatch pegs the odds of March rate cut at just 7%, but sees the first reduction of the year likely in June, with a follow-on move in October.
The Labor Department will publish its benchmark February non-farm payrolls report Friday, with investors looking for a hiring gain of around 156,000 and a headline unemployment rate around 4.1%.
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