US equity futures traded with little direction on Friday as investors awaited the release of July’s employment report, a key indicator that could shape expectations for the Federal Reserve’s next policy move. Markets were also monitoring renewed geopolitical tensions after another Houthi attack on Saudi Arabia, while negotiations between Iran and Oman over the Strait of Hormuz continued.
Futures Trade Cautiously Before Payrolls Release
As of 02:52 ET (06:52 GMT), Dow Jones futures were down 0.1%, S&P 500 futures were broadly unchanged and Nasdaq 100 futures edged 0.2% higher.
Thursday’s session ended lower on Wall Street. The Nasdaq Composite slipped 0.06% after earnings from memory chip manufacturers Sandisk (NASDAQ:SNDK) and Western Digital (NASDAQ:WDC) failed to justify investors’ elevated expectations despite solid quarterly results.
The Dow Jones Industrial Average declined 0.85%, snapping a five-day winning streak, while the S&P 500 lost 0.18%.
Analysts at Vital Knowledge said it was “impressive the index didn’t fall more than it did considering a number of negatives,” pointing to rising Treasury yields, disappointing technology guidance, higher oil prices and renewed concerns over Federal Reserve independence.
Labour Market Figures Could Shift Interest Rate Expectations
The market’s main focus is now the US nonfarm payrolls report.
Economists forecast that 88,000 jobs were created in July, up from 57,000 in June, while the unemployment rate is expected to remain at 4.2%.
Although hiring has slowed in recent months, layoffs have remained limited. Labour force participation has also weakened as tighter immigration policies and demographic trends reduce the number of available workers.
Recent economic reports have shown softer employment in the services sector, although broader indicators continue to suggest that domestic demand remains resilient.
Investors will be assessing whether the latest employment figures strengthen the case for further Federal Reserve tightening or support expectations that interest rates will remain unchanged.
Fresh Houthi Attack Raises Regional Concerns
Saudi Arabia warned of escalating regional instability after an attack by Iran-backed Houthi forces left 11 civilians injured.
The incident came despite reports that Iran and Oman are close to agreeing new arrangements for shipping through the Strait of Hormuz. However, uncertainty remains over whether any agreement can restore confidence in one of the world’s most important oil shipping routes.
President Donald Trump said the waterway is “sort of open right now,” while Iranian officials described negotiations as being in the “final stage.”
Brent crude climbed 1.2% to $83.46 a barrel as energy markets reacted to the latest developments.
Meta Faces $942 Million Court Penalty
Meta Platforms (NASDAQ:META) has been ordered to pay more than $900 million following a New Mexico court ruling over child safety on Facebook and Instagram.
The judgement follows an earlier jury decision that found the company had breached consumer protection laws. Alongside the financial penalty, Meta has been instructed to strengthen safety measures for younger users.
Berkshire Hathaway Set to Release Results
Investors are also preparing for Berkshire Hathaway’s (NYSE:BRK.B) quarterly earnings announcement on Saturday.
The results will provide another update on the investment group’s performance under Greg Abel, with markets also watching for changes to Berkshire’s investment portfolio following recent purchases and disposals.
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