Dow futures turn negative, Nasdaq futures jump as yields dive on jobs report

Dow futures turn negative, Nasdaq futures jump as yields dive on jobs report

Dow Jones Industrial Average futures fell into negative territory on Friday following a big miss on the April jobs report, but tech stocks jumped higher as Treasury yields dropped sharply.

Dow futures erased earlier gains and dipped 40 points. Contracts tied to the S&P 500 gained 0.3%. Nasdaq 100 futures popped 1.2% as the 10-year Treasury yield fell 5 basis points to 1.51%.

The Labor Department said nonfarm payrolls increased by just 266,000 in April, far less than the 1 million total economists were expecting, according to Dow Jones.

The unemployment rate rose to 6.1% last month, higher than an expectation of 5.8%. Meanwhile, March’s originally estimated total of 916,000 was revised down to 770,000.

April’s job report carries extra importance as the Federal Reserve maintains a zero rates policy and other easing measures in the face of a recovering economy. As marketplace concerns about inflation brew, some on Wall Street believe an exceptionally strong jobs market report could prove an early sign for the Fed that conditions are finally returning to healthy.

In early trading Friday, stocks linked to the reopening of the economy were gaining. Shares of Royal Caribbean and Norwegian Cruise Line holdings were up about 2% each in premarket trading. Expedia Group was also higher.

Shares of Roku rallied more than 8% in premarket trading after the streaming company blew past expectations with its first-quarter results. Roku posted adjusted earnings of 54 cents​​ per share, compared to an estimated loss of 13 cents per share, according to Refinitiv. Revenue rose 79% from a year ago and exceeded expectations.

On Thursday, the Dow Jones Industrial Average added 318 points, or 0.9%, to close near its session high and clinch a record close of 34,548.53. The S&P 500 rose 0.8% to 4,201.62. The Nasdaq Composite erased earlier losses and gained 0.4% to 13,632.84.

Thursday’s gains came after a better-than-expected reading on jobless claims. First-time claims for unemployment insurance totaled 498,000 for the week ended May 1, hitting a fresh pandemic-era low and better than a Dow Jones estimate of 527,000.

For the week, the major stock indexes were mixed as of Thursday’s close. The Dow is up about 2%, the S&P 500 had gained 0.49% and the Nasdaq Composite had shed more than 2.3%.

Become a smarter investor with CNBC Pro
Get stock picks, analyst calls, exclusive interviews and access to CNBC TV. 
Sign up to start a free trial today

About Author

Related posts