Investors hold off ahead of Fed report

WEAK commodities and a firmer dollar pressured US stocks yesterday as investors shunned big bets before a jobs report that could determine the next move from the Fed.

The Dow Jones industrial average dipped 19.07 points, or 0.17 per cent, to 10,948.58. The Standard & Poor’s 500 Index eased 1.91 points, or 0.16 per cent, to 1,158.06. But the Nasdaq Composite Index added 3.01 points, or 0.13 per cent, to 2,383.67.

The dollar reversed a long downtrend, slamming oil and gold markets, which in turn took a toll on energy and mining stocks. Newmont Mining Corp and Freeport-McMoRan Copper & Gold both fell more than 2 per cent.

Investors said better-than-expected weekly jobless claims limited declines, but the spotlight was on today’s larger non-farm payrolls report.

Today’s report is expected to show payrolls were unchanged in September, but the release has bigger implications for a market hoping that weak data will spur the Federal Reserve to take further steps to boost the economy.

“This one, unfortunately, gets into the realm of economic psychology,” said Quincy Krosby, market strategist at Prudential Financial in Newark, New Jersey.

“I think the market would appreciate (a number) that's a little better, but that still allows the Fed to come in.”

The euro’s recent rally against the dollar stalled as investors booked profits. The dollar and equities have had an inverse relationship as investors take money out of stocks for the perceived safety of the greenback.

Alcoa kicked off the unofficial start to earnings season after the closing bell. The largest US aluminium producer reported a lower third-quarter profit, but said global markets were strengthening. Its shares rose 3.2 per cent to $12.59 in extended trade.

But some lacklustre earnings reports weighed on the market during the regular session after PepsiCo trimmed the top end of its earnings forecast, while Marriott International’s results failed to beat high expectations. Pepsi was down 3 per cent at $66.10 and Marriott slid 5.8 per cent to $35.67.