INSTANT VIEW: U.S. private payrolls fall more than expected

NEW YORK (Reuters) - U.S. private employers cut 473,000 jobs in June, more than expected but down from the 485,000 jobs lost in May, a report by a private employment service said on Wednesday.

KEY POINTS: * The median of forecasts from 25 economists surveyed by Reuters for the ADP Employer Services report, jointly developed with Macroeconomic Advisers LLC, was for 393,000 private-sector jobs lost in June. * June's job loss was the smallest since October 2008. * The May figure was revised from an originally reported loss of 532,000 jobs.

COMMENTS:

NIGEL GAULT, CHIEF U.S. ECONOMIST, IHS GLOBAL INSIGHT, LEXINGTON, MASSACHUSETTS:

"It says that even though the economy is starting to show signs of being about to turn, that's not the case for the labor market. The labor market is still getting worse, but it's getting worse more slowly, but it's probably going to get worse for the rest of the year.

"The ADP last month, it missed very badly. It was much more pessimistic than the officials numbers. So, what we don't know this time around is are the two going to come into line? Or is ADP once again too pessimistic. If the two come into line, then tomorrow's payrolls numbers are going to be far worse than anybody was expecting. I suspect, at least to some degree, that ADP is going to prove too pessimistic for this month."

TOM DI GALOMA, HEAD OF FIXED INCOME RATES TRADING, GUGGENHEIM PARTNERS, NEW YORK:

"This will set us up for weaker (jobs) numbers tomorrow. But the overwhelming factor is Treasury supply coming next week. At the end of the day, ADP and employment data are nothing but distractions from next week's supply.

"I'm still a longer-term buyer on dips. I do feel 4 percent will be the high print of the year on 10-year yield."

CARL LANTZ, INTEREST RATE STRATEGIST, CREDIT SUISSE, NEW YORK:

"It looks pretty ugly, it looks like the improvement in payrolls will be short lived."

JACOB OUBINA, CURRENCY STRATEGIST, FOREX.COM, BEDMINSTER, NEW JERSEY:

"The number was about 80,000 worse than what was expected, so that's a pretty huge disappointment for the market. But I would say that investors should probably take this number with a grain of salt. ADP missed the actual payroll number last time around by about 200,000, so its predication capabilities leave something to be desired."

RICK MECKLER, PRESIDENT, LIBERTYVIEW CAPITAL MANAGEMENT, NEW YORK:

"This is just going to be a long process. People who are looking for quick solutions are going to continue to be disappointed. I think what you're seeing over and over is that employment will probably be one of the last things to turn. it doesn't mean things won't get better, but it does mean that by the time it does turn, it will be much more obvious that the recovery is underway.

MARK BONHARD, INVESTMENT ADVISOR, DAWSON WEALTH MANAGEMENT, CLEVELAND, OHIO:

"The data surprises me a little bit in that the consensus out there seems to be that business is improving and that the economy has hit bottom. This definitely is not good news."

"It favors Treasuries over corporate bonds."

MARKET REACTION: STOCKS: U.S. stock index futures pare gains BONDS: U.S. Treasury debt prices initially pare losses DOLLAR: U.S. dollar pares losses versus euro