Futures slip as focus turns to monthly jobs report

div classBodysc17zpet90 cdBBJodivpReuters – U.S. stock index futures edged lower on Friday as sentiment remained fragile after a sharp selloff on Wall Street in the previous session, with investors awaiting April jobs data that could throw light on the path of interest rate hikes.p

pThe Labor Departments report, due at 08:30 a.m. ET, is expected to show nonfarm payrolls likely increased by 391,000 jobs last month after rising 431,000 in March.pdivdivdiv classBodysc17zpet90 cdBBJodiv

pUnemployment rate dropped to its prepandemic low of 3.5 in April, the report is also likely to show, while wages rose solidly, underscoring the challenge the Federal Reserve faces to curb high inflation.p

pThe main indexes plunged on Thursday, reversing all gains from a relief rally on Wednesday, as investors feared bigger rate hikes might be needed to tame inflation running at a fourdecade high. Traders see 78 chance of a 75 basis point hike at the Feds June meeting, despite Fed chief Jerome Powell ruling out such a rate hike in the next meeting.[IRPR]p

pThe Nasdaq tumbled 5, its biggest oneday percentage decline since June 2020, as ratesensitive growth stocks were hammered.p

p“For the market to find a real bottom, it needs some signs that inflation is starting to cool off first,” said Marios Hadjikyriacos, senior investment analyst at forex broker XM.p

p“This puts additional emphasis on the upcoming US employment report, particularly on the wage growth component that is considered an early indicator of ‘organic’ inflationary pressures.”p

pThe S&P 500 growth index is down nearly 20.3 yeartodate as compared to a 4.9 fall in its value counterpart, which houses economysensitive sectors like energy, banks and industrials.p

pMegacap stocks were mixed on Friday, with Microsoft Corp down 0.6 in premarket trading.p

pWells Fargo led declines among big banks with a 1.1 fall. p

pAt 06:58 a.m. ET, Dow eminis were down 81 points, or 0.25, S&P 500 eminis were down 16.5 points, or 0.4, and Nasdaq 100 eminis were down 77 points, or 0.6.p

pInvestors continued to pull out capital from equity funds leading up to the Feds May 4 meeting, a BofA report citing EPFR data showed, with U.S. equities suffering a fourth week of outflows with 2.1 billion lost.p

pAmong stocks, DoorDash Inc rose 6.6 as the food delivery firm raised its fullyear forecast for core growth target after reporting upbeat quarterly revenue.p

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pp Reporting by Devik Jain in Bengaluru Editing by Sriraj Kalluvilap

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