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Midday Market Update

Stocks Higher Ahead of Early Close; Data in Focus

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U.S. Market    
Stocks were up at midday as the markets prepare to close early ahead of the Independence Day holiday. Economic data made headlines Wednesday, and more focus was on employment data leading up to Friday's jobs report. 

 Automatic Data Processing (ADP) reported that private-business payrolls in June rose by 188,000, beating the expected increase of 160,000. Jobs in the services sector led the way, jumping by 161,000 last month, though factory jobs were nearly flat, as was the revised ADP report for May. Meanwhile, jobless claims for the the week ended June 19, dropped to 343,000, a decrease of 5,000 from the previous week. The four-week moving average showed little change, coming in at 345,500 for the week. 

Separately, the Institute for Supply Management's nonmanufacturing purchasing managers' index decreased to 52.2 last month from 53.7 in May. The reading moved opposite from the expected increase to 54.0. Although activity is still expanding and the employment subindex improved by more than four points, the other subindexes were mixed. 

U.S. trade data revealed imports for May increased by 1.9%, seasonally adjusted, from the previous month, while exports slipped by 0.3%. The U.S. trade deficit widened, as a result, by 12% to $43.03 billion, marking the largest gap since September 2007, as demand for U.S. products in key markets, such as China and Mexico, waned. 

The Dow and the Nasdaq were each 0.5% higher at midday, while the S&P 500 had gained 0.2%. 

Stocks on the Move
 Walgreen (WAG) posted a 2.3% increase in June same-store sales, missing expectations of a 3.1% increase. The firm said a change in calendar affected results, though generic drugs continue to cut into Walgreen's, and its competitors', top line. Customer traffic also decreased during the month. Shares were down by 1.8% at midday. 

 Chesapeake Energy (CHK) announced it plans to sell some of its Northern Eagle Ford Shale and Haynesville Shale assets to a division of Exco Resources (XCO). The total asset sale includes nearly 65,000 net acres, and the deal, expected to close this quarter, is valued at $1 billion. Chesapeake says the sale will provide additional funding to its capital spending budget for the year. Chesapeake shares were 0.3% higher at midday, while Exco shares jumped by 7.5%. 

Foreign Markets
Stocks overseas were in the red across the board. The Shanghai Composite fell by 0.6%, the Nikkei 225 lost 0.3%, and the Hang Seng slumped by 2.5%. 

In Europe, the FTSE 100 fell by 1.2%, the Paris CAC lost 1.1%, and the DAX fell by 1.0%. 

Kevin O'Shaughnessy does not own (actual or beneficial) shares in any of the securities mentioned above. Find out about Morningstar’s editorial policies.