(Reuters) – Futures tracking the S&P 500 hovered at record highs on Friday as investors marked time ahead of closely watched employment data for more clarity on the U.S. jobs market and the fate of easy monetary policy.
The Labor Department’s most comprehensive jobs report, due at 8:30 a.m. ET, is expected to show U.S. job growth accelerated in June as companies boosted perks for workers amid booming demand, following reopening.
Economists polled by Reuters forecast nonfarm payrolls to increase by 700,000 jobs last month after rising 559,000 in May.
Markets have been spearheaded by inflation and economic data in the past few sessions, with investors fearing a potentially stronger-than expected economic recovery and runaway inflation could force the Federal Reserve to pare back its support.
“The market clearly needs a strong figure to hold on to its upbeat mood, as a surprise weakness in jobs figures wouldn’t get the Fed to do more, when inflation is hovering around a worryingly high 5% and it’s not even sure that it’s a peak,” said Ipek Ozkardeskaya, senior analyst at Swissquote Bank.
Still, after a strong end to the first half of the year, the S&P 500 began the second half with its sixth consecutive all-time closing high in the previous session amid a broad-based rally led by so-called economy-linked “value” stocks.
Focus now also shifts towards the second-quarter earnings season and progress on President Joe Biden’s infrastructure bill that could help the equity market keep the momentum.
The Democratic-controlled U.S. House of Representatives approved a $715 billion surface transportation and water infrastructure bill on Thursday in what Democrats see as an early step toward sweeping infrastructure legislation that Congress hopes to complete in September.
Next week, markets will look to minutes from the Fed’s June policy meeting which will offer more details on the policymakers thinking on inflation, bond tapering and interest rates at a time when easy monetary policy appears to be at an inflection point amid a booming U.S. economy.
At 6:41 a.m. ET, Dow e-minis were up 2 points, or 0.01%, S&P 500 e-minis were up 2 points, or 0.05%, and Nasdaq 100 e-minis were up 29.5 points, or 0.2%.
Rate-sensitive Bank of America, Wells Fargo, Goldman Sachs, Citigroup, JPMorgan Chase & Co and Morgan Stanley traded mixed before the opening bell.
Virgin Galactic Holdings jumped 27% after the space tourism firm said billionaire entrepreneur Richard Branson would travel to the edge of space on the company’s test flight on July 11, beating out fellow aspiring billionaire astronaut Jeff Bezos.
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