Dow futures slip ahead of key jobs report as investors brace for signs of slowing labor market
How are stock-index futures trading:
S&P 500 futures fell 0.64%
Dow Jones Industrial Average futures fell 0.39%
Nasdaq 100 futures fell 1.07%
On Thursday, the Dow Jones Industrial Average fell 219.2 points, or 0.54%, to 40,756, as the S&P 500 fell 16.66 points, or 0.3%, to 5,503, and the Nasdaq Composite increased 43.4 points, or 0.25%, to 17,128.
Investors braced themselves for Friday’s jobs report, which economists expect will show the creation of 161,000 new jobs in August, up from a lackluster 114,000 in July.
If the Bureau of Labor Statistics jobs report does show an uptick in employment, economists believe the U.S. Federal Reserve will likely only make a 25 basis point cut to interest rates at its upcoming meeting in September.
But if the jobs report shows weaker jobs creation than expected, it is anticipated the U.S. central bank will push ahead with a sharper 50 basis point interest rate cut next month. Ahead of the publication of the U.S. jobs report, investors had dialed down their expectations the Fed will make a 50 basis point cut.
Federal Reserve Governor Christopher Waller is also set to speak at an economic outlook event hosted by the University of Notre Dame in Indiana, in a speech that is set to give investors more clues as to the central bank’s thinking.
The S&P 500’s three-day drop sits in line with broader historical trends that place September as the worst month for the index. “If [the S&P 500 index] does end the month lower, it would be the 5th consecutive September that it’s lost ground now,” Deutsche Bank’s analysts noted.
The U.S. stock index’s losses came even as the Magnificent Seven posted a strong performance, led by Tesla on news the company is planning to launch a “full self driving” autopilot system in Europe and China by the first quarter of 2025, subject to regulators’ approval.