U.S. Stock Index Futures Slide Ahead of Labor Market Report

(Reuters) – U.S. stock index futures slipped on Friday ahead of a crucial labor market report, amid concerns about inflation and the incoming Trump administration’s policies affecting the Federal Reserve’s monetary policy outlook.

At 5:31 a.m. ET, Dow E-minis were down 48 points, or 0.11%. S&P 500 E-minis decreased 15.75 points, or 0.26%, while Nasdaq 100 E-minis fell 70.5 points, or 0.33%.

Elevated Treasury yields added to investor nervousness, with the 10-year benchmark near eight-month highs at 4.69%.

All eyes are on the Labor Department’s non-farm payrolls report, due at 8:30 a.m. ET, particularly after earlier jobs data painted conflicting views about employment status.

The report is expected to show the economy added 160,000 jobs in December, with unemployment remaining steady at 4.2% from the previous month.

Later in the day, investors will also evaluate the University of Michigan’s preliminary report on consumer sentiment for January.

Wall Street’s main indexes are on track to close their second consecutive week in the red, with the benchmark S&P 500 down nearly 3% from its record high reached a month ago.

Fresh inflation concerns have taken center stage, compelling the Fed to issue a cautionary forecast on monetary easing last month. This comes as policy changes on trade and immigration are anticipated under President-elect Donald Trump, who will be inaugurated in 10 days.

Multiple reports on Trump’s plans, including one concerning a national economic emergency to expedite tariff implementation, have left investors uncertain about their potential impact on the economy and global trade.

The Russell 2000 index, which tracks domestically focused small-cap companies, has lost more than 8% from its record high in late November. Futures tracking the index dipped 0.4% on Friday.

On Thursday, voting members of the Federal Open Market Committee, including Boston Fed President Susan Collins and Kansas City Fed President Jeff Schmid, emphasized the need for a measured approach to lowering borrowing costs this year.

Traders predict the central bank will keep interest rates steady for much of the first half of 2025, according to the CME Group’s FedWatch Tool.

Among premarket movers, chip stocks like Nvidia (NASDAQ:NVDA) fell 1.1%, and Advanced Micro Devices (NASDAQ:AMD) dropped 2.2% after a report indicated that the U.S. might introduce new export regulations as early as Friday.

U.S.-listed shares of TSMC gained 1.3% after the world’s largest contract chipmaker reported fourth-quarter revenue exceeding market forecasts, driven by demand for artificial intelligence.

Quarterly reports from Walgreens Boots Alliance (NASDAQ:WBA), Constellation Brands (NYSE:STZ), and Delta Air Lines (NYSE:DAL) are expected before market opening.

Earnings reports will increase next week as investors await insights into the potential impacts of the incoming government’s policy proposals on companies, as well as the resilience of the consumer and the U.S. economy.