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Traders work on the floor of the New York Stock Exchange.
NYSE
Stock futures edged lower on Sunday night after finishing near the flat line on Friday after investors allayed concerns over a much weaker-than-expected labor market report released on Friday.
Futures contracts on the Dow Jones Industrial Average fell 33 points, or 0.08%. S&P 500 and Nasdaq 100 futures fell 0.17% and 0.25%, respectively.
In regular trading on Friday, the Dow Jones slipped 8.69 points to 34,746.25. The S&P 500 lost 0.2% to 4,391.34. The Nasdaq Composite fell 0.5% to 14,579.54.
Markets reacted to a disappointing jobs report that initially lowered major averages, although investor worries eased after digesting the data and realizing things may not be so gloomy than the data initially suggested. The Labor Department reported Friday that the economy created just 194,000 jobs in September, compared to 500,000 according to the Dow Jones estimate.
“The three-month moving average non-farm payroll is 550,000,” said Joe LaVorgna, chief economist for the Americas at Natixis CIB, in a note. “At this rate, employment will recoup its pandemic-related losses by next July. The labor market recovery has progressed enough for the Fed to begin a cut next month with a completion target around June of l ‘next year.”
Chris Zaccarelli, chief investment officer of the Independent Advisor Alliance, added that it would have taken an “extremely bad” jobs report to derail the Federal Reserve’s plan to start removing stimulus measures and that well that the report was “disappointing, without a doubt, we don’t ‘I think it’s bad enough to stop them.”
What’s more, the unemployment rate itself fell to 4.8%, well below economists’ forecasts.
This week, the big banks will launch their third quarter results. JPMorgan Chase, Goldman Sachs, Bank of America, Morgan Stanley, Wells Fargo and Citigroup are expected to report from Wednesday. Delta Airlines and Walgreens Boots Alliance are also on deck.
Analysts estimate a profit growth rate of 27.6% for the S&P 500 in the third quarter and a 15% price increase for the index over the next 12 months, according to FactSet. However, the financials sector is expected to experience the smallest price increase as it had the smallest upside difference between the ascending target price and the closing price on October 6.
No economic data is expected for Monday.
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