Slightly Better Than Expected Jobs Data May Lead To Initial Strength On Wall Street

The major U.S. index futures are currently pointing to a higher open for the markets on Friday, with stocks likely to move back to the upside after ending yesterday’s volatile session mostly lower.

The futures moved notably higher following the release of a closely watched Labor Department report showing slightly stronger than expected U.S. job growth in the month of May.

The Labor Department said non-farm payroll employment shot up by 139,000 jobs in May after jumping by a downwardly revised 147,000 jobs in April.

Economists had expected employment to increase by about 130,000 jobs compared to the addition of 177,000 jobs originally reported for the previous month.

Meanwhile, the report said the unemployment rate came in at 4.2 percent in May, unchanged from the previous month and in line with economist estimates.

The modestly bigger than expected increase in employment may help offset concerns about the strength of the economy following some recent downbeat data.

Recent reports have led to some worries about the possibility of stagflation due to President Donald Trump’s trade war, although the markets have held up relatively well amid optimism about eventual trade deals and interest rate cuts.

Following the volatility seen during Wednesday’s session, stocks continued to fluctuate over the course of the trading day on Thursday. The major averages once again spent the day bouncing back and forth across the unchanged line before eventually closing in negative territory.

While the tech-heavy Nasdaq slid 162.04 points or 0.8 percent to 19,298.45, the S&P 500 fell 31.51 points or 0.5 percent to 5,939.30 and the Dow dipped 108.00 points or 0.3 percent to 42,319.72.

Stocks saw some strength earlier in the day after President Donald Trump confirmed in a post on Truth Social that he had an approximately 90-minute phone call with Chinese President Xi Jinping.

Trump described the phone call with his Chinese counterpart as “very good” and said it “resulted in a very positive conclusion for both Countries.”

The president also said the two countries’ teams will be “meeting shortly at a location to be determined” and noted the conversation was focused “almost entirely” on trade.

The phone call between Trump and Xi comes following recent signs of rising tensions between the U.S. and China over the trade agreement reached last month.

However, traders seemed reluctant to make more significant moves ahead of the release of the Labor Department’s closely watched monthly jobs report on Friday.

Economists currently expect employment to increase by 130,000 jobs in May after jumping by 177,000 jobs in April, while the unemployment rate is expected to hold at 4.2 percent.

The data could have a significant impact on the outlook for the economy following yesterday’s weaker than expected reports on private sector employment and service sector activity.

With the more closely watched monthly jobs report looming, the Labor Department released a report this morning showing first-time claims for U.S. unemployment benefits unexpectedly increased in the week ended May 31st.

Reflecting the lackluster performance by the broader markets, most of the major sectors ended the day showing only modest moves.

Airline and networking stocks saw some weakness on the day, while telecom and gold stocks moved to the upside.

Commodity, Currency Markets

Crude oil futures are inching up $0.10 to $63.47 a barrel after climbing $0.52 to $63.37 barrel on Thursday. Meanwhile, after falling $24.10 to $3,375.10 an ounce in the previous session, gold futures are creeping up $0.40 to $3,375.50 an ounce.

On the currency front, the U.S. dollar is trading at 144.51 yen versus the 143.53 yen it fetched at the close of New York trading on Thursday. Against the euro, the dollar is valued at $1.1403 compared to yesterday’s $1.1445.

Asia

Asian stocks ended mixed in lackluster trading on Friday despite the leaders of the U.S. and China agreeing to further talks aimed at reaching a deal.

U.S. President Donald Trump described a phone call with his Chinese counterpart as “very good” and said it “resulted in a very positive conclusion for both countries.”

Traders also reacted to an ECB rate cut and braced for a U.S. employment report later in the day for additional clues on the Fed’s rate trajectory.

Economists expect U.S. employment to increase by 130,000 jobs in May after an increase of 177,000 jobs in April. The unemployment rate is expected to hold at 4.2 percent.

Gold prices inched higher in Asian trading and headed for a weekly gain as the U.S. dollar faced a weekly loss amid signs of economic weakness and stalled trade talks.

Oil dipped but headed for its first weekly gain in three as optimism over peak seasonal demand offset lingering concerns about oversupply.

China’s Shanghai Composite Index finished marginally higher at 3,385.36, while Hong Kong’s Hang Seng Index fell 0.5 percent to 23,792.54 as Trump’s phone call left key issues unresolved.

Japanese markets rose on a weaker yen and due to increased demand for the index futures ahead of the June 13 fixing of special quotation prices.

The Nikkei 225 Index gained half a percent to close at 37,741.61 as Japan and the U.S. continue trade negotiations toward a win-win deal. The broader Topix Index settled 0.5 percent higher at 2,769.33.

Tech heavyweights Advantest and Tokyo Electron climbed 2.2 percent and 1.3 percent, respectively. Automakers Honda and Nissan both rose around 1.3 percent.

Investors shrugged off data that showed Japan’s exports fell in the first 20 days of May due to tariff woes.

South Korean markets remained closed for a public holiday. Australian markets ended slightly lower in choppy trade, dragged down by tech stocks, miners and financials.

The benchmark S&P/ ASX 200 Index slipped 0.3 percent to 8,515.70, while the broader All Ordinaries Index closed 0.3 percent lower at 8,741.90.

Across the Tasman, New Zealand’s benchmark S&P/NZX-50 Index ended down 0.1 percent at 12,563.48.

Europe

European shares are turning in a mixed performance on Friday as investors react to a slew of downbeat regional data. Trade tensions persist despite Chinese President Xi Jinping and U.S. President Donald Trump holding a much-anticipated call on Thursday to resolve trade issues.

Meanwhile, media reports suggest Trump and billionaire Elon Musk plan a phone call to ease tensions after public disputes over a U.S. budget bill.

While the German DAX Index is down by 0.1 percent, the U.K.’s FTSE 100 Index is up by 0.1 percent and the French CAC 40 Index is up by 0.2 percent.

In economic news, German industrial production declined more than expected in April as the temporary boost from the frontloading of orders ahead of the U.S. tariff hikes faded, data from Destatis revealed.

Industrial output declined 1.4 percent month-on-month in April, in contrast to the 2.3 percent increase in March. This was the biggest fall since December, when production posted a similar decline.

Separate data revealed that Germany’s trade surplus declined in April as exports to the U.S. logged a double-digit decline amid a notable growth in imports.

German exports fell 1.7 percent month-on-month in April, reversing an increase of 1.2 percent in March. The pace of decline was worse than the expected fall of 0.5 percent.

By contrast, imports grew 3.9 percent compared to a 1.4 percent drop in March. As a result, the trade surplus decreased to EUR 14.6 billion from EUR 21.3 billion in the previous month.

Elsewhere, U.K. house prices declined unexpectedly in May after the stamp duty holiday ended in March, data from the mortgage lender Halifax revealed.

House prices dropped 0.4 percent month-on-month in May, in contrast to the 0.3 percent increase in April. Prices were expected to grow 0.4 percent. On a yearly basis, house price inflation softened to 2.5 percent in May from 3.2 percent in the previous month.

HSBC Holdings was moving higher after announcing that Sir Mark Tucker will step down as Chairman of the Board of Directors and member of the Board on 30 September 2025.

Sportswear retailer Adidas was slightly lower after U.S. peer Lululemon Athletica slashed its annual profit forecast.

Software company Dassault Systemes fell about 1 percent after delaying its earnings target timeline by one year.

U.S. Economic News

Employment in the U.S. increased by slightly more than expected in the month of May, according to a report released by the Labor Department on Friday.

The Labor Department said non-farm payroll employment shot up by 139,000 jobs in May after jumping by a downwardly revised 147,000 jobs in April.

Economists had expected employment to increase by about 130,000 jobs compared to the addition of 177,000 jobs originally reported for the previous month.

Meanwhile, the report said the unemployment rate came in at 4.2 percent in May, unchanged from the previous month and in line with economist estimates.

At 3 pm ET, the Federal Reserve is scheduled to release its report on consumer credit in the month of April. Consumer credit is expected to increase by $10.9 billion in April after climbing by $10.2 billion in March.