U.S. Stock Futures Await Jobs Report, Tech Sentiment Mixed as Nvidia Slips

U.S. stock index futures remained relatively flat on Friday as investors awaited the release of the crucial May nonfarm payrolls report. This data is expected to provide insights into the labor market’s strength and potentially influence the Federal Reserve’s interest rate decisions.

While the benchmark S&P 500 and Nasdaq closed slightly lower on Thursday due to a tech stock decline, some megacap tech stocks showed a slight rebound in premarket trading. However, overall trading remained subdued as investors focused on the upcoming jobs report.

Economists polled by Reuters predict that the U.S. economy added 185,000 new jobs in May, with the unemployment rate expected to hold steady at 3.9%. This data is crucial in determining whether the labor market is indeed easing, as suggested by Thursday’s weekly jobless claims report. A softer labor market could support the Fed’s case for reducing interest rates.

Market expectations for Fed rate cuts have fluctuated throughout the year, but recent data indicating a weakening labor market and easing inflation have increased the likelihood of a rate reduction in September.

Investors are also eagerly anticipating fresh inflation data next week, just before the Fed’s policy meeting on June 12th. While the central bank is expected to maintain rates steady, traders will closely scrutinize updated economic and policy forecasts for clues on the timing and pace of potential rate cuts.

Chipmaker Nvidia experienced a slight decline in premarket trading, slipping 0.2% and falling below the $3 trillion market valuation mark. This move placed it behind Apple as the world’s third-most valuable company.

In other premarket activity, GameStop shares surged over 30% as stock influencer “Roaring Kitty” announced an upcoming livestream on YouTube, sparking excitement among retail investors. Other meme stocks like AMC Entertainment and Koss Corp also saw significant gains, while retail-focused trading platform Robinhood climbed 2.9%.

Lyft shares rose 1.7% after the ride-hailing company projected a 15% annual growth in its gross bookings through 2027.

Overall, the U.S. stock market is poised for a cautious start on Friday, with investors anxiously awaiting the nonfarm payrolls report and its potential implications for the Federal Reserve’s monetary policy. The mixed sentiment in the tech sector, with Nvidia’s slight decline offset by gains in other areas, reflects the market’s ongoing assessment of the economic landscape and interest rate outlook.