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Stock index futures point to a lower open Thursday, but sentiment will likely be dictated by a host of jobs figures due this morning.
S&P futures (SPX) -0.6%, Nasdaq 100 futures (NDX:IND) -0.7% and Dow futures (INDU) -0.6% were lower.
The 10-year Treasury yield (US10Y) rose 6 basis points to 4.01% and the 2-year yield (US2Y) rose 9 basis points to 5.04%.
The Fed minutes out Wednesday reinforced the market conviction of a July hike. Fed funds futures are pricing in a 90% chance of a quarter-point rise.
“Fed minutes sounds suitably hawkish – in tune with the market mood of late,” ING said. “The Fed paused in June, but some participants would have preferred a hike.”
On the economic front, job cuts dropped 49% in June to 40,709 from 80,089 in the Challenger job cuts report.
The ADP jobs report came in also at 497K, much higher than the forecasted 228K figure.
“Since last August, when the new methodology was introduced, ADP reports a total 2.27M increase in private payrolls, 380K less than the official measure,” Pantheon Macro’s Ian Shepherdson said. “It’s still too soon to know if this undershoot reflects some sort of permanent downside bias in ADP’s methodology or is just noise, and note that in the past couple months ADP has been slightly stronger than the official numbers.”
Weekly jobless claims hit soon after with the forecast for a rise to 245K.
“We think the drop in claims last week is noise rather than a sign that the labor market is re-tightening,” Shepherdson said. “Monday June 19th was the Juneteenth holiday, so most state unemployment offices were closed.”
After the start of trading, the Job Openings and Labor Turnover Survey, or JOLTS, for May is due. The consensus is for a drop in job openings to 9.935M.
“This is not job vacancies, but externally advertised job vacancies. This number was boosted by everyone job hopping/having mid-life crisis after the pandemic,” UBS’ Paul Donovan said. “As that calms, the vacancy rate should drop. Hardly anyone bothers to participate in the survey, undermining the value of the results.”
Services sector numbers are also on the calendar after the opening bell.
The S&P Global services PMI for June is expected to drop to 54.1. The ISM services index is forecast to post a rise to 51.
