US stock futures slide ahead of crucial jobs report: Markets turn


A cautious tone dominated markets ahead of a major US jobs report that could give traders insight into the Federal Reserve’s policy trajectory.

US stock futures fell lower. A modest rise in the dollar left it on track to rise for the ninth week in the past 10 weeks. The interest rate on government bonds was higher. Oil extended its decline to a third day.

Economists estimate that U.S. nonfarm payrolls rose by 220,000 in November as hiring rebounded due to weather-related disruptions and strikes. It’s the final payrolls report before the Fed’s next interest rate decision, with swap trading bringing the odds of a quarter-point cut later this month to about 65%.

“If we get a surprisingly good number, you can expect prices to move back towards the 50-50 range,” said Michael Brown, senior strategist at Pepperstone. “Given the time of year, market volumes are lighter than normal, so you’re more likely to see an outsized reaction – and that’s another reason for people to sit on their hands.”

The French week of political turmoil should end positively on the markets. The country’s bonds outperformed their eurozone peers after National Rally leader Marine Le Pen told Bloomberg News a budget could be delivered within weeks. The euro was stable. The CAC 40 index rose more than 1%, rising for a seventh day in its longest winning streak in nearly a decade.

Friday’s US labor market data will have a major impact on whether the S&P 500 can build on this year’s 27% rally. The excitement around artificial intelligence and optimism that President-elect Donald Trump’s policies will boost US markets have pushed the benchmark to its best year since 2019.

Bank of America Corp. strategist Michael Hartnett said the powerful rally in both US stocks and cryptocurrencies has left the asset classes looking frothy.

The S&P 500’s price-to-book ratio has risen to 5.3 times through 2024 and is approaching a peak of 5.5 hit in March 2000, at the height of the technology bubble, according to data compiled by Bloomberg. BofA’s Hartnett said there is a high risk of an “overshoot” in early 2025 as the S&P 500 approaches 6,666 points — about 10% above current levels.

On Bitcoin, Hartnett said the digital asset, with a market capitalization of more than $2 trillion, was comparable in size to the world’s 11th largest economy. On Friday, Bitcoin retreated from an all-time high above $103,000, reaching as much as 7% at one point.

In Asian trading, shares in China rose, a sign that investors were gearing up for new economic support measures after a key policy meeting that started on Wednesday.

South Korea was another focus, with losses following previous declines after the commander of the country’s special forces said there would be no second martial law. The country’s benchmark stock index fell as much as 1.8% before paring the decline.

In the commodities sector, oil contributed to the decline on concerns that OPEC’s decision to reverse the revival of halted production will not prevent the formation of a surplus next year.

Some of the major moves in the markets:

This story was produced with the help of Bloomberg Automation.

With the help of Sagarika Jaisinghani and Divya Patil.

This article was generated from an automated feed from a news agency without any changes to the text.

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