US stocks pause recent rally ahead of Friday jobs report

Major US equity indices traded mixed on Thursday and were seen consolidating recent gains as investors turned cautious after mixed labor-market data, which raises barrier for Friday's official jobs report. 

Data release on Thursday showed private sector employers added fewer-than-expected new jobs in December (ADP report), while weekly jobless claims unexpectedly dropped closer to nearly 43-year low.

At the time of reporting, the Dow Jones Industrial Average was lower by around 10-point to 19,930, while the broader S&P 500 Index declined 2-points to 2,269. Meanwhile, tech-heavy Nasdaq Composite outperformed the broader indices and gained around 12-point to 5,488.

Ahead of the scheduled event risk, Friday's NFP report, investors seemed inclined to take some profits off the table following the recent up-surge, which now seems to fuel concerns that valuations might have run ahead of any notable earnings growth.

Technical outlook

Carol Harmer, Founder at charmertradingacademy.com, notes, "We are still struggling on the topside and have a small trendline coming in @ 2272...so we need to clear this 2274/77 area really before buyers could come back in..."

She further writes, "Now the daily pivot is at 2266....we have support to 2263...so this area will be of interest....If we fail to hold then obviously we shall see sellers back in the market looking to drive us lower....we have the previous 2233 lows...Below 2230 and we see 2203....which is the 38.2 med term Fib....."