Stock futures point to gains ahead of jobs report

How will January jobs report impact markets?

Charles Schwab chief investment strategist Liz Ann Sonders provides insight into market, economic and employment trends in the U.S. amid the coronavirus pandemic.

U.S. equity futures are trading higher ahead of the latest report on the labor market.

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The major futures indexes suggest a rise of 0.5% when the last trading session of the week gets underway. Stocks have gained in four straight sessions.

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The economic event of the week comes Friday morning with the January employment report.

The Labor Department is expected to say the U.S. economy added 50,000 new nonfarm jobs last month, rebounding from a surprise loss of 140,000 jobs in December amid surging virus cases and expanding lockdowns. The unemployment rate is expected to hold steady at 6.7% for the third month in a row and the lowest since March.

HIRING MAY HAVE REBOUNDED FROM 1ST MONTHLY LOSS SINCE APRIL

At the same time the Commerce Department is out with the U.S. trade balance for December. The deficit is expected to narrow to $65.2 billion from $68.1 billion in November.

On Thursday, the number of Americans who filed for unemployment benefits fell below 800,000 last week, which was better than economist expectations but still remains high due to the pandemic.

UNEMPLOYMENT AID NOT REACHING MILLIONS OF OUT-OF-WORK AMERICANS, NEW STUDY SUGGESTS

Hopes grew for a gradual global economic recovery from the damage of the coronavirus pandemic.

In Washington, President Biden urged lawmakers to “act fast” on his economic stimulus plan but also said he’s open to changes. Democrats and Republicans remain far apart on support for the president's $1.9 trillion stimulus package, but investors are betting that the administration will opt for a reconciliation process to get the legislation through Congress.

In Europe, London's FTSE added 0.2%, Germany's DAX was higher by 0.3% and France's CAC gained 0.9%.

In Asia, Japan's benchmark Nikkei 225 surged 1.5%, Hong Kong's Hang Seng jumped 0.6% and China's Shanghai Composite slipped 0.2%.

Wall Street was cheered by strong company earnings and optimism that Washington can reach a deal for another round of fiscal stimulus for millions of Americans.

TickerSecurityLastChangeChange %
I:DJIDOW JONES AVERAGES31152.69+96.83+0.31%
SP500S&P 5003886.56+14.82+0.38%
I:COMPNASDAQ COMPOSITE INDEX13832.192798+54.45+0.40%
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The S&P 500 index rose 1.1% to 3,871.74. It was the index’s fourth-straight gain. The Dow Jones industrial average picked up 1.1%, to 31,055.86. The technology-heavy Nasdaq gained 1.2%, to 13,777.74, also an all-time high.

Wall Street may see the return of volatility in shares of companies such as GameStop and AMC Entertainment, after the online brokerage app Robinhood said it had removed temporary trading restrictions on all stocks, according to an update on its website.

ROBINHOOD LIFTS TRADING RESTRICTIONS ON ALL STOCKS, INCLUDING GAMESTOP

GameStop shares were higher by more than 3% in premarket trading. GameStop's shares and others favored recently by retail investors fell on Thursday, while U.S. Treasury Secretary Janet Yellen vowed to protect investors, but also said financial market regulators needed to fully understand the recent trading frenzy before taking any action.

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In energy trading, U.S. benchmark crude added 49 cents to $56.72 a barrel in electronic trading on the New York Mercantile Exchange. It gained 54 cents to $56.23 per barrel on Thursday. Brent crude, the international standard, added 59 cents to $59.43 a barrel.

The Associated Press contributed to this article.

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