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U.S. stock futures struggled on Friday, as investors awaited for all-important nonfarm payrolls data, with rising bond yields and energy prices also in the spotlight.
How are stock-index futures trading?
-
Dow Jones Industrial Average futures
YM00,
+0.09%
were flat at 34,662 -
S&P 500 futures
ES00,
+0.07%
were flat at 4,390 -
Nasdaq-100 futures
ES00,
+0.07%
were softer at 14,874
On Thursday, the Dow Jones Industrial Average
DJIA,
rose 338 points, or 0.98%, to 34755, the S&P 500
SPX,
increased 36 points, or 0.83%, to 4400, and the Nasdaq Composite
COMP,
gained 152 points, or 1.05%, to 14654.
What’s driving the market?
Washington avoided an unprecedented federal default after the Senate voted late Thursday to raise the government’s debt ceiling into December. The reprieve is temporary as lawmakers must head back to the bargaining table before the end of the year.
Optimism around a deal was enough to rally stocks, but that faded by Friday as investors took to the sidelines ahead of September payrolls data, which could offer a window into the timing of a tapering move by the Federal Reserve. Data released Thursday showed a drop in weekly jobless benefit claims.
Economists expect the U.S. added 500,000 new jobs, more than double the gains from a disappointing August, when data is released at 8:30 a.m. Eastern Time. Such a rise is expected to keep the Fed on a path to announce in November plans to scale back pandemic stimulus.
But some are looking for an even bigger rise, which could be a problem for markets, said Steen Jakobsen, chief investment officer at Saxo Bank. “Strong data could ironically prove negative for equities if the reaction sees yields moving aggressively higher, especially for more yield-sensitive tech and momentum stocks in the concentrated Nasdaq-100 index
NDX,
” he told clients in a note.
“That index hasn’t managed to trade above its 21-day moving average (currently near 15,050) since mid-September, while the S&P 500 index is trading on its 21-day moving average near 4390 after attempting to surge above it yesterday,” said Jakobsen.
Bond yields were on the rise Friday, with that of the 10-year U.S. Treasury note
TMUBMUSD10Y,
up 2 basis points to 1.591%, extending gains from Thursday that saw 10- and 30-year rates hitting their highest levels since June, after debt ceiling fears eased and weekly jobless claims fell.
Markets will also be watching for average hourly earnings and the monthly employment rate, as well as any revisions to August data. Wholesale inventories for August are due at 10 a.m. Eastern Time.
How are other assets trading?
-
The U.S. oil benchmark
CL00,
+0.66% BRNX21
was up 1% to $79.11 a barrel, and headed for its seventh-straight weekly gain, with the contract up 4% for the week. Gold futures
GC00,
+0.04%
were up modestly at $1,759.80 an ounce. -
The ICE U.S. Dollar Index
DXY,
-0.06% ,
a measure of the currency against a basket of six major rivals, was flat. -
In European equities trade, the Stoxx Europe 600
SXXP,
-0.20%
fell 0.3% and London’s FTSE 100 UKX, -0.03% was flat. -
China’s CSI 300 index
000300,
+1.31%
rose 1.3% as markets returned from a multiday holiday. Japan’s Nikkei 225
NIK,
+1.34%
gained 1.3%.
