US stock futures swung between small gains and losses after the April jobs report showed another strong month for job gains.
Futures tied to the Dow Jones Industrial Average slipped 0.1%, a day after the blue-chip index slumped more than 1,000 points, its worst day since 2020. S&P 500 futures edged down 0.2% while technology-heavy Nasdaq-100 futures dropped 0.2% .
Futures, which had been down about 0.4% ahead of the data release, briefly turned higher in the minutes following the report.
The economy added 428,000 jobs in April and the unemployment rate remained unchanged at 3.6%. Economists surveyed by The Wall Street Journal projected that 400,000 jobs were created in April and that the unemployment rate fell to 3.5%—where it stood just before the pandemic and a five-decade low—from 3.6%.
Stocks have been whipsawed in recent days as investors have tried to gauge what impact the Federal Reserve’s plan to raise interest rates will have on the economy. Investors are caught between competing hopes: that rate increases will be significant enough to tame rapidly rising inflation, but not so large that they will derail economic growth.
“The market is trying to balance whether central banks are more worried about inflation or about dumping growth and the market has clearly decided they are more worried about inflation,” said Altaf Kassam, head of investment strategy for Europe, the Middle East and Africa at State Street Global Advisors. “If the Fed is going to be fighting inflation at all costs then it will certainly have an impact on stocks.”
Ahead of the opening bell,
rose almost 7% after the food-delivery firm reported a rise in quarterly revenue late Thursday.
also rose nearly 7% after raising its guidance for the year.
US stocks rally Wednesday after the Federal Reserve raised interest rates by half a percentage pointbuoyed by relief that it wasn’t actively considering even larger increases in the future, but that relief faded Thursday as investors reassessed the outlook for stocks.
Valuations for US markets have “moved from rich to very rich” in the past 10 years as stock prices have risen more than earnings, said Frank Benzimra, head of Asia equity strategy at Société Générale. But as interest rates climb, the value that investors place on companies’ future cash flows is decreasing, he said.
In bond markets, the yield on the benchmark 10-year US Treasury note rose to 3.079% from 3.066% on Thursday, which marked its highest level since November 2018. Bond yields rise as prices fall.
One reason for the volatile swings in markets: Investors lack an obvious haven as bonds and gold have come under pressure from rising interest rates.
“To cope with this volatility you need a buffer but fixed income is not the buffer that it used to be,” said Mr. Kassam.
Brent crude, the global oil benchmark, rose 1.8% to $112.87 a barrel, extending a recent run of gains driven by expectations that the European Union was set to ban imports of Russia’s oil in response to its invasion of Ukraine. Gold prices edged up 0.4%
Bitcoin fell 1.6% to $35.854, after slumping more than 8% Thursday as the market selloff prompted investors to exit risky bets such as cryptocurrencies.
Overseas, indexes in both Asia and Europe retreated, tracking losses benchmark in the US, with declines most pronounced for the tech-heavy Hang Seng Index, which slumped 3.8%. In mainland China, the Shanghai Composite Index fell 2.2%. In Europe, the pan-continental Stoxx Europe 600 fell 1.5%.
owner International Consolidated Airlines Group fell more than 6% after reporting an operating loss in the first quarter. Adidas fell more than 4% after warning that its sales in China were expected to drop.
Japanese stocks bucked the broader downtrend as the Tokyo market reopened after three days of holidays, with the Nikkei 225 gaining 0.7%.
write to Will Horner at William.Horner@wsj.com and Rebecca Feng at firstname.lastname@example.org
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