Stock futures slipped Thursday in overnight trade as investors eyed the September jobs report for more clues about the Federal Reserve’s tightening campaign.
Futures linked to the Dow Jones Industrial Average lost 12 points, or 0.04%, while S&P 500 futures fell 0.15%. Futures linked to the Nasdaq 100 fell 0.29%.
Shares of Advanced Micro Devices fell in overnight trading after the chipmaker warned that its third-quarter earnings would be lower than expected. Shares of Levi Strauss slipped after a forecast cut.
The major moving averages closed lower during regular trading but are on course to cap their best week since June 24 and end about 4% higher. The Dow fell 346.93 points, or 1.15%, to 29,926.94, while the S&P 500 and Nasdaq Composite lost 1.02% and 0.68%, respectively.
All major S&P sectors ended the session in negative territory except for energy. The sector rose 1.8% as oil prices rose and is on track to end the week up 14.7%.
Thursday’s downtrend comes as investors remain nervous ahead of the September jobs report, which is due out on Friday. The results could provide further certainty on the Fed’s tightening cycle, with a strong labor market or upside surprises suggesting the Fed may need a tougher stance to slow the economy and tame rising prices. Economists polled by Dow Jones expect the data to show nonfarm payrolls rising by 275,000 and unemployment at 3.7%.
“The environment is ripe for a crisis and if the Fed keeps up its hawkish communications, I think we’re very likely to break something in the financial markets,” said Scott Minerd, Guggenheim’s global chief investment officer, on CNBC’s show ” Closing Bell: Overtime”. ” on Thursday.
Minerd said the pace of tightening is starting to create cracks in financial markets and could force a change in the Fed in the coming weeks.
“All the signs are there,” he said. “I can’t tell you exactly what’s going to cause it, but the environment is ripe and when the Fed turns around, they won’t announce it in advance, they won’t ring a bell.”
A surprise to the downside, which occurred 75% of the time in the September jobs report over the past 25 years, could prompt investors to rally, he added.
Along with the big jobs report, wholesale inventories and consumer credit data will also be released on Friday. cannabis stock Tilray Brandswhich rose Thursday as the White House announced marijuana pardons will report earnings results.
Comments are closed.