Sept 4 (Reuters) – Futures tracking the tech-heavy Nasdaq 100 and the benchmark S&P 500 indexes rose on Friday ahead of jobs data that could test the recent momentum in equities.
The data will come a day after Federal Reserve Governor Christopher Waller tempered rate-hike bets. Traders are now expecting a nearly 50% chance of a rate increase, compared with 63% before his comments, according to the CME FedWatch tool.
While Fed Chair Kevin Warsh’s focus on inflation has prompted some analysts to question if labor market trends could influence the central bank’s rate outlook, it is still expected to set the tone for the final session of the week.
After a subdued start to September, equities recovered their poise after Waller said he would support holding rates steady if data shows inflationary pressures are abating.
“Waller’s comments matter for several reasons. This is the last major Fedspeak event before the September meeting blackout, leaving markets without further guidance until the decision,” said Felix Vezina-Poirier, chief strategist at BCA Research.
“Waller has also often been ahead of the curve in both hiking and cutting cycles, giving his guidance added weight.”
Job growth is expected to have rebounded in August. Nonfarm payrolls likely increased by 56,000 jobs after declining 23,000 in July, according to a Reuters survey of economists.
The last nonfarm payrolls print showed that the economy had unexpectedly shed jobs in July, and previously reported job gains for the prior two months were revised sharply lower.
At 4:24 a.m. ET, Dow E-minis were down 40 points, or 0.07%, S&P 500 E-minis were up 4.75 points, or 0.06%, and Nasdaq 100 E-minis were up 124.25 points, or 0.42%.
Lululemon Athletica fell 17.67% in premarket trading after it slashed its full-year profit and revenue forecasts.
Adobe fell 3.18% after it said longtime CEO Shantanu Narayen will hand over the reins to insider Anil Chakravarthy.
As investors head into the Labor Day weekend, debate about the seasonal weakness of September also persists.
Historically, September is the weakest month for stocks. But most of the weakness comes in the second half of the month, with returns averaging worse than 1%, according to Melissa Brown, global head of investment decision research at SimCorp.
Investors will also get the latest inflation readings when the Labor Department releases CPI and PPI data next week.
(Reporting by Niket Nishant and Purvi Agarwal in Bengaluru; Editing by Maju Samuel)
