Economic news

Nasdaq Futures Jump 1%, Dow Negative after Weak Jobs Data

May 7 (Reuters) - Futures tracking the Nasdaq jumped more than 1% on Friday as mega-cap growth stocks rallied after a downbeat jobs report eased valuation concerns and worries about the U.S. Federal Reserve reducing its massive stimulus program anytime soon.

The Labor Department’s closely watched employment report showed U.S. employers hired far fewer workers than expected in April, with nonfarm payrolls increasing by only 266,000 jobs last month after rising by 770,000 in March.

Economists polled by Reuters had forecast payrolls advancing by 978,000 jobs.

Highly valued stocks such as Microsoft Corp, Apple Inc, Inc and Facebook Inc rose more than 1% each in premarket trading.

“One number doesn’t make a trend, but it takes some of the heat off the economy overheating and inflation moving dramatically higher,” said Larry Adam, chief investment officer at Raymond James. “This puts less pressure on the Fed to prematurely talk about tapering.”

The report also showed unemployment rate rose to 6.1% in April from 6.0% in March.

Economically sensitive cyclical stocks reversed earlier gains, with planemaker Boeing Co down 0.1%, lender Goldman Sachs Group Inc falling1.4% and oil major Chevron Corp dropping 0.6%.

At 9:06 a.m. ET, Dow e-minis were down 32 points, or 0.09%, S&P 500 e-minis were up 13 points, or 0.31%, and Nasdaq 100 e-minis were up 154 points, or 1.13%.

The Nasdaq Composite index is set to fall 2.3% this week, its worst weekly decline since late February. The S&P 500 and the Dow Jones Industrial Average indexes, however, are on track for weekly gains.

Payments firm Square Inc rose 4.7% after reporting better-than-expected quarterly profit, as surging demand for bitcoin fueled a jump in cryptocurrency transactions on its application.

Streaming device maker Roku Inc jumped 11.4% following upbeat revenue outlook, while fitness equipment maker Peloton Interactive gained 5.6% as it laid out steps to improve the safety of the equipment.

(Reporting by Shreyashi Sanyal and Sruthi Shankar in Bengaluru; Editing by Maju Samuel)

Source: Reuters


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