U.S. private employers unexpectedly shed more jobs in March, dimming hopes for job growth ahead of Friday's key employment report, while business conditions in New York City slipped.
U.S. private employers cut 23,000 jobs in March, missing expectations for an increase in jobs although fewer than the adjusted 24,000 jobs lost in February, a report by a private employment service said on Wednesday.
It throws a little cold water on the idea we were going to be adding jobs in March, which is a little disappointing, people thought finally this might be the month, said John Canally, investment strategist and economist for LPL Financial in Boston.
U.S. stock futures added to losses after the ADP report, while the dollar fell against the euro and U.S. government debt prices turned higher.
The U.S. government releases March non-farm payrolls data on Friday, although markets will be closed for the Good Friday holiday. The data is expected to show payrolls rose by 190,000 in the month.
The median of estimates from 35 economists surveyed by Reuters for the ADP Employer Services report, jointly developed with Macroeconomic Advisers LLC, was for a rise of 40,000 private-sector jobs this month.
In a separate report, business activity in New York City fell in March from February to a level that was the lowest since August, but remained above the mark indicating expansion.
The Institute for Supply Management-New York's seasonally adjusted index of current business conditions fell to 60.6 in March from a revised 78.1 in February. The 50 level separates growth from contraction.
The six-month outlook index, however, rose to 88.2 in March from a revised 80.1 in February.
In other data, U.S. mortgage applications rose in the latest week for the first time in three weeks as demand for home purchase loans reached the highest level since October.
(Additional reporting by Leah Schnurr)
(Editing by Theodore d'Afflisio)