Weak wednesday data highlights uncertainty. Investors want assurance economy is not falling into the abyss: strategist
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Stocks were struggling for direction in early afternoon trade, with the S&P 500 and Dow Jones Industrial Average trading near the flat line, while the Nasdaq held on to a 0.1% gain.
Treasury yields, however, were extending their decline as investors reacted to data that showed private-sector payrolls disappointed in May and that the services sector edged into
contraction. That fall in Treasury yields, accompanied by rising expectations for more than one rate cut by the Federal Reserve in 2025, was a result of the weak data, Kent Engelke, chief
economic strategist at Capitol Securities Management, told MarketWatch in an interview. In turn, that helped buoy equities, at least in morning trade, he said. Data so far doesn't
indicate the economy is "falling into the abyss," but instead reflects the uncertainty that's gripped businesses and consumers as President Donald Trump's on-again,
off-again tariff campaign continues. The narrative around the tariffs says the economy "is going to hell in a handbasket" while the S&P 500 has more than erased its April
selloff and is pushing back toward its February record high, Engelke said.