Stocks meander in build up to key U.S. jobs report
BNN Bloomberg
US equity futures were steady on Friday, reflecting a generally cautious mood on world markets ahead of a crucial monthly jobs report that could offer clues on how much further the Federal Reserve might raise interest rates.
Contracts on the S&P 500 and Nasdaq 100 were little changed, with both underlying indexes set for a second week of gains. Premarket US trading reflected concern over the impact of higher rates on company earnings, especially in the tech sector, where shares in cloud security company Zscaler Inc. and chipmaker Marvell Technology Inc. declined after downbeat outlook reports. Europe’s Stoxx 600 index was also flat, on course for a seven-week rising streak.
Stocks got a boost this week from a softening in China’s stringent Covid zero stance and signals from Fed Chair Jerome Powell of a downshift in the pace of rate hikes. Bets on where the US central bank’s rate will peak have now dropped below 4.9%, according to swap markets. The current benchmark sits in a range between 3.75% and 4%.
However, many economists reckon Friday’s employment report may fall short of the turning point Fed officials are seeking in their battle to beat back inflation. The median projection in a Bloomberg survey calls for payrolls to rise 200,000 in November, cooling only slightly from the previous month. Other market watchers point to signs that steep rate hikes will tip more economies into a downturn.
