Wall Street Awaiting Jobs Report

Wall Street is expected to remain stable on Friday as it anticipates the release of the important monthly US jobs report, which may provide indications for future Federal Reserve policies.

1. Payrolls Loom Large

Attention is focused on the US payrolls data set to be released later today, offering insights into the economy ahead of the Federal Reserve's December meeting. Economists predict an increase of 202,000 jobs in November, a significant rise from October's 12,000 due to disruptions from strikes and hurricanes, marking the smallest gain since December 2020.

Despite potential job growth, it is unlikely to shift market expectations that the Federal Reserve will implement another interest rate cut this month. A possible repeat of September's strong jobs report could impact future rate cut projections.

Financial markets currently assign about a 70% probability to a 25 basis point rate reduction at the central bank's policy meeting on December 17-18, according to CME's FedWatch tool.

2. Futures Steady Ahead of Nonfarm Payrolls

US stock futures showed little movement on Friday as investors exercise caution before the monthly jobs report. As of 03:50 ET (07:50 GMT), Dow futures were up 20 points (0.1%), S&P 500 futures climbed 3 points (0.1%), and Nasdaq 100 futures rose by 23 points (0.1%). The major indexes retreated from record highs set on Thursday, with the Dow Jones Industrial Average dropping nearly 250 points (0.6%).

For the week, the broad-based S&P 500 has increased by 0.7%, while the tech-heavy Nasdaq has gained 2.5%. Investors are primarily focused on the nonfarm payrolls data to gauge the health of the labor market, following Fed Chair Jerome Powell's comments about the robustness of the US economy.

3. Bitcoin Dominance to Fade?

Bitcoin retreated on Friday, slipping below the $100,000 mark after recently reaching record highs, raising concerns about its dominance in the cryptocurrency market. At 03:50 ET, Bitcoin traded 4.3% lower at $98,550, but was still over 1% higher for the week.

The cryptocurrency had surged this week due in part to optimism over favorable regulations under Donald Trump. However, Bitcoin's market share fell to 53.9%, down from a three-year high of approximately 59% in late November, prompting analysts at Citi to warn that new regulatory clarity may diminish Bitcoin's market dominance.

4. Investors Turn to Cash

Due to uncertainty regarding the sustainability of recent stock market gains, investors are shifting towards cash. A report from Bank of America indicated that $136.4 billion was deposited into cash in the week leading to Wednesday, representing the largest weekly inflow since March 2023.

While buying of US equities continued for the ninth consecutive week, the inflow decreased to $8.2 billion. In addition, $4.9 billion in bonds were purchased, and cryptocurrency experienced a $3 billion influx, marking its largest four-week inflow ever at $11 billion.

5. Brent on Course for Weekly Loss

Oil prices declined on Friday, with Brent crude set for significant weekly losses amid concerns over slowing demand after OPEC+ extended its supply cuts through 2025. By 03:50 ET, US crude futures (WTI) fell 0.4% to $68.02 per barrel, while Brent dropped to $71.77 per barrel.

For the week, Brent was projected to fall by around 1.5%, while WTI has kept some minor gains. OPEC+ delayed planned production increases by three months and extended cuts through the end of 2026 due to reduced global demand, particularly from China.