The markets on Wall Street are showing signs of uncertainty after a strong government jobs report was released early Friday. Futures for the Dow Jones industrial average fell 0.3% and futures for the S&P 500 dipped around 0.2%.
U.S. employers added a surprisingly robust 275,000 jobs in February, well ahead of the 200,000 jobs that economists were expecting. This strong jobs report has raised questions about the Federal Reserve’s next decision on interest rates later this month.
Fed Chair Jerome Powell recently stated that the central bank is “not far” from delivering the cuts to interest rates that Wall Street is hoping for. Traders are now looking towards June as the likeliest starting point for rate cuts, after earlier hopes for cuts in March were shelved.
Next week, the government will issue two big inflation reports, which will provide further insight into the state of the economy. In the meantime, in equities trading, companies like Docusign and The Gap have seen significant gains, while Costco has experienced a decline in premarket trading.
In Europe, major indices like France’s CAC 40 and Germany’s DAX are showing mixed results, while in Asia, markets are mostly up with Japan’s Nikkei 225 and Sydney’s S&P/ASX 200 posting gains.
Investors are remaining cautious, however, as reports suggest that higher interest rates could be on the horizon in countries like Japan once the economy picks up. In energy trading, benchmark U.S. crude and Brent crude both saw declines, while in currency trading, the U.S. dollar fell against the Japanese yen and the euro.
Overall, the markets are in a state of flux as investors await further economic data and the Federal Reserve’s decision on interest rates. The S&P 500 is within reach of another winning week, but the Dow Jones Industrial Average is on pace for its second down week in a row.
