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Indexes down: S&P 500 0.01%, Nasdaq 0.22%, Dow 0.17%

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US private payrolls decrease unexpectedly in June

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Centene ( CNC ) tumbles after pulling 2025 forecast

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Verint Systems ( VRNT ) jumps after report of Thoma Bravo buyout

talks

(Updates with market open prices)

By Sruthi Shankar and Nikhil Sharma

July 2 (Reuters) - U.S. stocks nudged lower on Wednesday

as surprisingly weak U.S. private jobs data raised concerns

about the labor market, while investors closely watched trade

negotiations as President Donald Trump's July 9 tariff deadline

approaches.

The ADP National Employment Report showed U.S. private

payrolls fell unexpectedly in June and job gains in the prior

month were smaller than initially thought.

Investors quickly increased their bets of a rate cut by the

U.S. Federal Reserve in July to 25.3%, from about 20% prior to

the report, according to LSEG data.

"I take it as a mixed bag. On one hand, the wage is still

strong, which is terribly important to the U.S. economy. On the

downside, if this isn't seasonality, this is the beginning of a

long-term trend in white collar jobs that'll spill over into the

total labor market," said Ross Mayfield, investment strategist

at Baird.

"It would be very damaging for the overall economy and

obviously make the Federal Reserve react despite their concerns

about tariffs causing inflation."

The Nasdaq and the S&P 500 closed lower in

the previous session, retreating from record highs as technology

stocks were pressured and Treasury yields climbed after data

showed stronger-than-expected job openings in May.

Focus now turns to the more comprehensive non-farm payrolls

report, scheduled for release on Thursday - a day earlier than

usual, as markets are closed on Friday for Independence Day. The

reading is expected to show U.S. job growth cooled in June and

the unemployment rate ticked up to 4.3%, according to a Reuters

poll of economists.

On trade, Trump said on Tuesday he was not thinking of

extending the July 9 deadline for imposing tariffs and expressed

doubts that an agreement could be reached with Japan, although

he said he expected a deal with India. The European Union's

trade chief is expected to hold talks this week with peers in

Washington.

At 10:00 a.m. ET (1400 GMT), the Dow Jones Industrial

Average fell 75.68 points, or 0.17%, to 44,419.26, the

S&P 500 lost 0.92 points, or 0.01%, to 6,197.09, and the

Nasdaq Composite gained 43.60 points, or 0.22%, to

20,246.49.

Meanwhile, the blue-chip Dow was within 1.4% of

hitting an all-time high.

U.S. Senate Republicans passed Trump's massive

tax-and-spending bill on Tuesday by the narrowest of margins,

advancing a package that would slash taxes, reduce social safety

net programs and boost military and immigration enforcement

spending, while adding $3.3 trillion to the national debt.

The legislation now heads to the House of Representatives

for possible final approval, although a handful of Republicans

have already opposed some of the Senate provisions.

Seven of the 11 major S&P sectors nursed losses, with

healthcare falling about 0.7%, leading declines.

Centene ( CNC ) tumbled 33.7%, set for its worst day on

record if losses hold, after the health insurer said it had

withdrawn its 2025 earnings forecast following data that showed

a significant drop in expected revenue from its marketplace

health insurance plans.

Shares of peers including Elevance Health ( ELV ) dropped

7%, Molina Healthcare ( MOH ) sank 15% and UnitedHealth ( UNH )

lost 2%.

Adding to the strain on equities, the U.S. 10-year

benchmark yield rose 4 basis points, extending its

climb from the previous session.

However, megacaps such as Tesla and Apple ( AAPL )

helped limit the overall losses and rose more than 2.4%

each.

Tesla

posted

another big drop in quarterly deliveries, putting it on

course for its second straight annual sales decline as demand

falters due to backlash over CEO Elon Musk's political stance

and an aging vehicle lineup.

Verint Systems ( VRNT ) rose 5% after Bloomberg News

reported buyout firm Thoma Bravo was in talks to acquire the

call-center software maker.

Declining issues outnumbered advancers by a 1.12-to-1 ratio

on the NYSE and by a 1.1-to-1 ratio on the Nasdaq.

The S&P 500 posted 15 new 52-week highs and two new lows,

while the Nasdaq Composite recorded 20 new highs and 25 new

lows.