Author: Fiona Craig

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.

US equity futures were largely flat as investors adopted a cautious stance ahead of the release of closely watched monthly employment data and the prospect of a Supreme Court ruling on the White House’s hardline import tariffs. Developments in Washington are also drawing attention, with President Donald Trump set to meet oil industry leaders amid renewed focus on Venezuela’s energy resources, while mining heavyweights Glencore (LSE:GLEN) and Rio Tinto (LSE:RIO) have revived merger discussions.

US futures steady

Futures linked to the main US equity indices hovered near unchanged levels on Friday as markets awaited the nonfarm payrolls report.

By 02:54 ET, futures on the Dow Jones Industrial Average, S&P 500 and Nasdaq 100 were all little changed.

Wall Street ended Thursday’s session mixed. The S&P 500 finished broadly flat, the Nasdaq Composite declined 0.44%, while the Dow Jones Industrial Average gained 0.55%.

Defence stocks outperformed after President Trump called for a substantial increase in US military spending, proposing a rise to $1.5 trillion by 2027 from the $901 billion approved by Congress for this year.

Those gains were partly offset by weakness in technology shares, reflecting lingering concerns over whether heavy investment in artificial intelligence will translate into sufficient long-term returns. The S&P 500 technology index fell 1.5%, pressured by large-cap names such as Microsoft and Nvidia.

Jobs report in the spotlight

Attention is now firmly on the December US nonfarm payrolls release, which is expected to shed light on labour market conditions at the end of the fourth quarter.

Economists forecast that the US economy added around 66,000 jobs in the final month of 2026, slightly up from 64,000 in November, while the unemployment rate is expected to edge down to 4.5% from 4.6%.

“The unemployment rate may be monitored even more than payrolls, mirroring the Fed[eral Reserve]’s focus on joblessness,” analysts at ING said in a note.

Labour market data remain central to expectations for Federal Reserve policy, after the central bank cut interest rates several times last year to support a cooling jobs market, despite inflation proving slow to ease.

ING added that other labour indicators released this week have “sent conflicting U.S. macro signals.” While private payrolls data were described as “acceptable,” job openings disappointed and total job cuts in 2025 were the highest since 2020.

Supreme Court tariff decision awaited

Markets are also watching for a potential Supreme Court ruling on the legality of President Trump’s sweeping tariffs, which could arrive as early as Friday, though timing remains uncertain.

The case centres on Trump’s use of emergency economic powers under a 1977 law to impose the levies. During hearings in November, justices across the ideological spectrum expressed doubts about the administration’s legal rationale.

According to ING, recent comments from Trump suggest the White House is bracing for a possible adverse outcome. Online betting platform Polymarket currently assigns only a one-in-four chance that the court will rule in Trump’s favour.

If the tariffs are struck down, analysts warn this could introduce fresh uncertainty into US trade policy. A key issue would be whether the government might be required to refund an estimated $150 billion in duties already paid by importers.

Some observers believe the administration could respond to an unfavourable ruling by pursuing alternative legal routes to reintroduce the tariffs.

Trump to meet oil industry leaders

In Washington, President Trump said he plans to meet executives from several major oil companies on Friday to discuss the future of Venezuela’s extensive oil reserves.

In an interview with Fox News, Trump said the “top 14 companies are coming” to the White House and would face the task of “rebuild[ing]” Venezuela’s severely degraded oil infrastructure.

It remains unclear which companies will attend. Reuters reported, citing sources familiar with the matter, that the administration has also invited the heads of commodity trading firms Vitol and Trafigura.

Trump has repeatedly signalled his intention to exert control over Venezuelan oil, potentially on a long-term basis, following a US military operation last weekend that led to the capture of the country’s long-standing leader, Nicolas Maduro.

Earlier this week, Trump said Caracas had agreed to ship up to 50 million barrels of oil to the US, although the Financial Times reported that oil companies are seeking “serious guarantees” before committing large-scale investment to the country.

Glencore and Rio Tinto revisit merger talks

Shares in Rio Tinto fell in London after the miner confirmed it has restarted merger discussions with Glencore.

Glencore shares jumped 6.7% in London trading by 03:37 ET, after news of the renewed talks was first reported by the Financial Times.

Glencore later confirmed it is in “preliminary discussions with Rio Tinto” over a potential combination of some or all of their businesses, including the possibility of an all-share merger.

“This deal could be a win-win for both parties, providing Rio with the copper it needs and diluting iron ore exposure while unlocking value for Glencore holders,” RBC Capital Markets analysts led by Ben Davis said in a note.

European equity markets traded modestly higher on Friday, with investors cautious ahead of closely watched US employment figures that could influence expectations for Federal Reserve policy in 2026.

By 08:05 GMT, Germany’s DAX was up 0.1%, France’s CAC 40 had added 0.5%, and the UK’s FTSE 100 was 0.3% higher.

Payrolls in focus for Fed outlook

Attention in Europe, and globally, was centred on the upcoming US nonfarm payrolls report, due later in the day, which is expected to offer fresh insight into the momentum of the world’s largest economy and the future direction of Federal Reserve monetary policy.

Economists anticipate a cooling but resilient labour market, with forecasts pointing to around 57,000 jobs added in the final month of 2025, compared with 64,000 in November.

The Federal Reserve lowered interest rates at each of its final three meetings in 2025, prioritising concerns over a softening labour market despite persistent inflation pressures. Markets now largely expect policymakers to leave rates unchanged later this month, though uncertainty remains high around the scale and timing of any further cuts this year as divisions among officials persist.

In Europe, data showed German industrial production rose 0.8% month on month in November, defying expectations for a 0.6% decline and offering tentative signs of a year-end recovery in the euro zone’s largest economy. Eurozone retail sales figures for November are due later, with analysts expecting continued pressure on household spending.

Tariff ruling and geopolitics in view

Political developments were also on investors’ radar. Greenland’s future remained in focus after the chief executive of mining company Amaroq said the US was considering investments in critical minerals projects on the island. The comments come ahead of discussions between Washington and Danish officials, as US President Donald Trump continues to stress Greenland’s strategic importance for national security.

Markets are also watching for a potential Supreme Court decision on the legality of the Trump administration’s global tariffs, which could be delivered as early as Friday. The court may rule that the International Emergency Economic Powers Act of 1977 did not authorise the levies, potentially casting doubt over roughly $150 billion in duties already paid by importers.

Mining sector draws attention

In corporate news, the mining sector was firmly in the spotlight after Glencore (LSE:GLEN) confirmed late Thursday that it is in preliminary talks over a possible acquisition by Rio Tinto (LSE:RIO)—a deal that could create the world’s largest mining company.

Rio Tinto, the world’s biggest iron ore producer, has a market value of about $142 billion, compared with Glencore’s roughly $65 billion at the previous close.

“It makes sense if terms are right for both,” said Argo Investments senior portfolio manager Andy Forster. ” The biggest question mark would be the culture of the two companies as Glencore clearly has a trading background, is very opportunistic and results-focused, some of those aspects of their culture could actually be good for Rio.”

Elsewhere, J Sainsbury plc (LSE:SBRY) said it now expects retail free cash flow of more than £550 million for the current financial year, upgrading its outlook after strong grocery-led trading over the Christmas period. Rivals Tesco (LSE:TSCO) and Marks and Spencer (LSE:MKS) also reported robust Christmas food sales on Thursday.

Oil prices head for weekly rise

Oil prices moved higher on Friday and were set to record another weekly gain, amid concerns that developments in Venezuela and Iran could disrupt global supply.

Brent crude futures rose 0.8% to $62.47 a barrel, while US West Texas Intermediate advanced 0.8% to $58.21. Both benchmarks jumped more than 3% on Thursday after two days of declines, putting them on track for weekly gains of around 2%—the third consecutive weekly increase.

Supply worries have been fuelled by civil unrest in major Middle Eastern producer Iran, alongside fallout from the Trump administration’s seizure of Venezuelan President Nicolas Maduro last week and his claims that the US intends to control the South American country’s oil sector.

UK equities edged higher on Friday, snapping a two-session decline, while sterling remained under pressure against the US dollar. Early trading was shaped by merger speculation in the mining sector and updates from several large-cap UK corporates.

By 08:23 GMT, the FTSE 100 index was up around 0.3%, while the pound slipped 0.07% against the dollar to roughly 1.34. Across Europe, Germany’s DAX was broadly flat, while France’s CAC 40 advanced about 0.6%.

Glencore and Rio Tinto confirm early-stage merger discussions

Glencore (LSE:GLEN) and Rio Tinto (LSE:RIO) confirmed they are holding preliminary discussions over a possible combination involving some or all of their businesses.

Both companies said there is no certainty that a transaction will proceed, but indicated that any deal could take the form of a court-approved scheme of arrangement under which Rio Tinto would acquire Glencore. In line with UK takeover regulations, Rio Tinto must either announce a firm offer or step away by 5 February.

Market commentators suggested a potential transaction could be driven by Rio Tinto’s interest in expanding its copper exposure, potentially gaining access to assets such as Glencore’s Collahuasi and Antamina mines, alongside a broader pipeline of growth projects. For Glencore, analysts noted a deal could offer an exit route for major shareholders and allow a sharper strategic focus on its marketing and trading operations.

Sainsbury’s upgrades cash flow outlook after festive boost

J Sainsbury plc (LSE:SBRY) lifted its cash flow guidance after reporting strong Christmas trading, underpinned by grocery-led growth.

The retailer now expects retail free cash flow to exceed £550 million for the current financial year, up from its previous forecast. Over the 16 weeks to 3 January, total retail sales excluding fuel rose 3.9% year on year, while like-for-like sales increased 3.4%.

Unite Group trades in line, reiterates full-year guidance

Unite Group plc (LSE:UTG) said trading remains in line with board expectations, as the student accommodation provider reaffirmed its full-year outlook.

The group maintained adjusted earnings per share guidance of 47.5p to 48.25p for the 2025 financial year. Fourth-quarter performance met expectations, supported by around 1p of non-recurring management fee income from a university joint venture. Unite also highlighted a restructuring completed late in the year, delivering an estimated 20% reduction in head-office staff costs, alongside steady demand for the 2026/27 academic year despite modest valuation declines in the fourth quarter.

IAG confirms CFO transition plan

International Consolidated Airlines Group (LSE:IAG) announced that Chief Financial Officer Nicholas Cadbury will step down and leave the group in mid-2026.

He will be succeeded by José Antonio Barrionuevo, who currently serves as Chief Financial and Transformation Officer at British Airways. The company said the transition reflects a planned succession process, with Barrionuevo expected to take on the group CFO role following Cadbury’s departure.

Strategic Minerals plc (LSE:SML) has reported a landmark year in 2025, supported by strong operating performance at its Cobre magnetite business, which generated reliable cash flow and enabled accelerated progress across its wider project portfolio.

At the Cobre operation in New Mexico, Strategic Minerals recorded its third-highest annual ore sales in the past 14 years, delivering revenue of approximately US$4.23 million. The steady cash generation from Cobre has provided the financial foundation for the group’s growth strategy, particularly the advancement of its flagship Redmoor tungsten-tin-copper project in Cornwall.

At Redmoor, the company reported high-grade drilling results, encouraging metallurgical test work, and continued progress toward an updated mineral resource estimate, which is expected in early 2026. Management said these developments further underline Redmoor’s position as one of the highest-grade undeveloped tungsten deposits in Europe, strengthening its strategic relevance amid growing Western demand for critical minerals.

Corporate momentum during the year was also reflected in a sharp re-rating of the shares, with the stock rising around 470% on AIM. In addition, Strategic Minerals secured a UK government grant of approximately £764,000 to help fast-track Redmoor toward the pre-feasibility stage, alongside increased engagement with investors.

Outside the UK, the company moved to monetise its Australian assets by agreeing a staged A$9 million sale of the Leigh Creek Copper Mine to Cuprum Metals. Proceeds from the transaction are expected to further support the group’s focus on Redmoor, while streamlining the portfolio.

Strategic Minerals ended 2025 with cash of around US$0.78 million, reflecting significant reinvestment into exploration activities in Cornwall. Management described the year as a strategic pivot, using Cobre’s cash flow to develop Redmoor into a potentially important Western supply source of tungsten, tin, and copper.

While the company’s outlook is underpinned by strong corporate progress and a recovery in financial performance, valuation metrics and moderate technical momentum suggest some caution. The absence of detailed earnings guidance also limits visibility on near-term performance.

More about Strategic Minerals plc

Strategic Minerals plc is an AIM-quoted international mining and exploration company with operations in the UK, the United States, and Australia. Its core assets include the Redmoor tungsten-tin-copper project in Cornwall, the Cobre magnetite operation in New Mexico, and the Leigh Creek Copper Mine in South Australia, providing exposure to critical and base metals with a focus on supplying strategically important minerals to Western markets.