NEW YORK (CNNMoney.com) -- Stocks were mixed at the open Wednesday as investors mulled two reports showing continued weakness in the job market.
The Dow Jones industrial average was up about a point, while the S&P 500 was down by about the same. The tech-heavy Nasdaq edged down 8 points, or 0.3%.
All three major gauges finished at five-month highs Tuesday. A report showing that the service sector activity improved in September and a surprise move by Japan's central bank to cut interest rates sparked a broad-based rally.
But the enthusiasm evaporated Wednesday as the dour jobs reports weighed on investor sentiment ahead of the government's monthly jobs report due out Friday.
According to a consensus of economists polled by Briefing.com, the number of jobs is expected to remain flat. At the same time, the unemployment rate is expected to have ticked up to 9.7% from 9.6%.
Economy: Payroll processing firm ADP reported the private sector jobs plunged in September, trouncing the forecast of an increase.
The U.S. economy lost 39,000 private sector jobs last month, said the ADP on Wednesday, which was much worse than expected. Economists were forecasting the report to show private sector employers added 18,000 jobs in September.
The number of job cuts planned by employers edged up slightly in September, but remained near a rock bottom 10-year low that was reported in August, according to a report from outplacement firm Challenger, Gray & Christmas.
Employers said they would cut 37,151 jobs in September, up 7% from the 34,768 jobs cuts reported in August.
As traders look ahead to the government's jobs report due on Friday, they will use the ADP and Challenger reports as a gauge of the national unemployment picture.
Meanwhile, the International Monetary Fund said a double dip recession is unlikely, but the global economic growth will slow from 4.8% this year to 4.2% in 2011.
Johnson & Johnson announced a deal to aquire Dutch biotechnology company Crucell for about $2.43 billion. J&J already owns 17.9% of Crucell's outstanding shares and last year, the two companies started working together on a flu vaccine. The stock for J&J and Crucell stock edged up in early trading.
Costco said its fourth-quarter income rose 16% to $432 million, or 97 cents per share -- beating analysts' estimates of 95 cents per share. The wholesaler's earnings got a boost from increased membership sales and strength overseas. Shares slid more than 1% in early trading.
World markets: European shares rallied in afternoon trading. Britain's FTSE 100, France's CAC 40 and the DAX in Germany all were about 1% higher.
Asian shares finished sharply higher. Japan's Nikkei index leapt 1.8% and the Hang Seng in Hong Kong jumped nearly 1.1%. The Shanghai Composite is closed for a week-long holiday.
Currencies and commodities: The dollar slipped against the euro, the British pound and the Japanese yen.
Gold futures for December delivery rose $5.20 to $1,345.50 an ounce, after reaching a fresh intraday record trading high of $1,351 an ounce earlier.
The price of crude oil for November delivery fell 29 cents to $82.53 a barrel.
Prices for U.S. Treasurys rose, pushing the yield on the 10-year note down to 2.41% from 2.48% late Tuesday. Bond prices and yields move in opposite directions.
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