Market Snapshot: U.S. stock futures drift lower lower as investors await key payrolls report


U.S. stock futures fell Friday, as investors awaited November jobs data, at the end of a volatile week driven by headlines over the omicron coronavirus variant and hawkish comments from Federal Reserve Chair Jerome Powell.

How are stock-index futures trading?
  • S&P 500 futures ES00, -0.37% slipped 0.2% to 4,562
  • Dow Jones Industrial Average futures YM00, -0.31% also dropped 0.2% to 34,547
  • Nasdaq-100 futures NQ00, -0.43% dropped 0.4% to 15,928

On Thursday, the Dow industrials DJIA, +1.82% rose 617.75 points, or 1.8%, to 34,639.79 — the best percentage gain since March 5, 2021 and the best point gain since Nov. 9, 2020. The S&P 500 index SPX, +1.42% closed up 1.4% to 4,577.10, its best day since Oct. 14. The Nasdaq Composite COMP, +0.83% added 0.8% to 15,381.32. All three indexes are reflecting a loss of under 1% for the week thus far.

The Russell 2000 index RUT, +2.74% gained 2.7% to finish at 2,206.33, a day after hitting its first correction since June 2020.

What’s driving the markets?

After several days of volatile action, major indexes logged positive closes for the first time in three sessions on Thursday. Gains were driven by hopes that the omicron variant of the coronavirus that causes COVID-19 will prove less deadly, even if more transmissible, and less disruptive for the global economy.

Investors learned of a second U.S. case of the omicron variant from a Minnesota resident visiting New York, who reportedly showed mild symptoms.

The U.S. economy swings squarely into focus on Friday, with November nonfarm payrolls that are expected to show 573,000 new jobs created, up slightly from 531,000 the prior month, according to economists polled by The Wall Street Journal. Those numbers are due at 8:30 a.m. Eastern Time, alongside the unemployment rate and average hourly earnings.

The data have become even more important after the Fed’s Powell this week spoke of a strong economy and the prospect of a quicker taper, which could speed up interest-rate hikes.

“If the virus news ticker stays quiet, a higher U.S. nonfarm payrolls print could see equity gains capped, with a slightly lower or on target print of 550K, not enough to entirely remove faster Fed-taper fears,” said Jeffrey Halley, senior market analyst at Oanda, in a note to clients.

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Investors will also hear from St. Louis Fed President James Bullard at 9:15 a.m. Eastern Time, with the Institute for Supply Management’s services index for November, October factory orders and a revision to core capital goods all due at 10 a.m. Eastern.

While markets bounced Thursday, volatility remains high, said Ipek Ozkardeskaya, senior analyst at Swissquote, in a note to clients.

“That’s a sign that the stress in the market is not over just yet, because the root cause of the latest market selloff is not only omicron, it’s also the fear of seeing the markets left with less Federal Reserve support due to Fed’s willingness to address the high inflation issue moving forward. And, that remains a major downside risk to the risky assets,” said Ozkardeskaya.

Shares of Chinese companies may be in focus on Friday, after Chinese ride-hailing giant Didi Global DIDI, -0.13% said late Thursday it will delist from the New York Stock Exchange, following pressure from the Chinese government. Shares of Didi rose 9% in premarket trading.

Among other assets, oil prices continued to rise, with West Texas Intermedicate crude CL00, +2.51% up 2.5% to $68.14 a barrel, and global benchmark Brent BRN00, +2.55% rising 2.3% to $71.28 a barrel.

On Thursday, the Organization of the Petroleum Exporting Countries and their allies, together known as OPEC+, decided to rollover their existing production policy and boost output at the start of next year, even amid concerns the omicron variant could hurt demand.

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