U.S. equity futures point to a higher open on Friday, suggesting stocks may start the session on a firmer footing after two days of uneven trading.
Market sentiment has been buoyed by the latest employment figures from the U.S. Labor Department, which, while weaker than expected, are being viewed as supportive for the outlook on monetary policy. Slower job creation is easing concerns that interest rates will need to stay higher for longer.
The report showed nonfarm payrolls rose by 50,000 in December, following a revised increase of 56,000 in November. Economists had been forecasting job growth of around 60,000, compared with the 64,000 initially reported for the prior month.
At the same time, the unemployment rate edged lower to 4.4% in December from a revised 4.5% a month earlier. Markets had expected the rate to ease to about 4.5%.
Although the Federal Reserve is still widely expected to keep rates unchanged at its upcoming meeting later this month, the data may reinforce expectations that rate cuts could resume later in the year if economic momentum continues to cool.
On Thursday, Wall Street delivered another mixed session. The Dow Jones Industrial Average recovered from the previous day’s pullback, while the Nasdaq posted its first decline in four sessions as technology shares retreated.
The Dow advanced 270 points, or 0.6%, to finish at 49,266, moving back toward its recent record close. The S&P 500 was little changed, edging up by less than a point to 6,921, while the Nasdaq slipped 104 points, or 0.4%, to 23,480.
Investor caution was evident, with many traders opting to stay on the sidelines ahead of the employment report.
Additional labor market data released earlier in the day showed initial jobless claims rose modestly in the week ended January 3, coming in at 208,000. While higher than the prior week’s revised reading of 200,000, the increase was slightly smaller than economists had anticipated.
Sector performance was uneven. Energy stocks rallied strongly as oil prices surged, pushing the Philadelphia Oil Service Index up more than 4% and lifting the NYSE Arca Oil Index by over 3%.
Housing-related shares also saw notable gains, with the Philadelphia Housing Sector Index climbing 3.4%.
By contrast, weakness in networking, biotechnology and semiconductor stocks weighed on the broader technology sector, contributing to the Nasdaq’s decline.
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