(Reuters) – U.S. stock index futures were little changed on Friday as investors waited for a crucial employment report that would confirm that growing slack in the U.S. labor market meant the Federal Reserve had more room to cut rates.
The benchmark S&P 500 and Nasdaq ended Thursday’s session slightly lower, dragged by falling technology stocks, despite hitting record intraday highs in early trading.
Some mega-cap tech stocks that took a hit in the previous session were also slightly higher premarket, but overall trading was subdued ahead of May nonfarm payrolls data expected later in the day.
Economists polled by Reuters estimate the U.S. economy created 185,000 new jobs in May, with the unemployment rate expected to remain steady at 3.9%.
Markets have struggled to anticipate the Fed’s actions this year. Expectations for early rate cuts as early as March quickly faded as economic data pointed to a tight labor market and continued price pressures.
However, Thursday’s weekly jobless benefits report was the latest in a series of data suggesting the labor market is easing, potentially giving policymakers more confidence they can cut rates while avoiding a flare-up of inflation.
“As always, payrolls are a bit of a lottery, but labor market data in recent days confirms that we are on an easing labor market trajectory,” ING analysts said in a note.
Traders now see a 68% chance of a rate cut in September, according to CME’s FedWatch tool, and have priced in about two cuts this year, according to LSEG data.
New inflation data will be released next week, just before the Fed ends its two-day policy meeting on June 12. The central bank is expected to keep rates steady, but traders will await updated economic and policy forecasts for further guidance on the timing and pace. of future cuts.
Chipmaker Nvidia rose slightly in premarket trading, up 0.2%, after losses in the previous session caused its market valuation to fall below $3 trillion, behind Apple’s, once again making it the third most valuable company was born into the world.
At 5:39 a.m. ET, the Dow e-minis were down 6 points, or 0.02%, the S&P 500 e-minis were unchanged and the Nasdaq 100 e-minis were up 18.75 points, or 0.10%.
Among individual movers, shares of GameStop rose 33.2% premarket after stock influencer “Roaring Kitty” appeared to mark its return to YouTube. His channel on the platform showed an upcoming livestream scheduled for Friday at noon ET.
Other so-called meme stocks rose, with AMC Entertainment and Koss Corp rising 9.9% and 8.7%, respectively. Retail-focused trading platform Robinhood gained 2.9%
Shares of Lyft rose 1.7% after markets closed Thursday, following a forecast of 15% annual growth in gross bookings through 2027.
(Reporting by Lisa Mattackal in Bengaluru, Editing by Pooja Desai)
