Futures Slide from Near Records After Friday’s Jobs Report

Futures Slide from Near Records After Friday’s Jobs Report

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Key Takeaways

• Stocks hover under the flatline on Monday, as investors expect inflation data later in the week
• US employers added 559,000 new jobs to the labor market, pushing main indexes higher

Stock futures are flat to negative to kick off the trading week on Monday. Major US benchmarks look weak in pre-market today after the S&P500 made a run toward a record high on Friday, boosted by optimism that the economic recovery gathers pace. S&P500 futures, along with Nasdaq futures and Dow futures turned negative this morning by around 0.1% each, after they were all marginally higher earlier.

The S&P500 now sits just 0.2% from its intraday record high at the beginning of May. The broad-market index advanced 0.6% last week to reach a gain of over 12% this year amid excitement about the economy’s ongoing reopening. The Dow Jones and the Nasdaq Composite also posted gains last week, even after Thursday’s session in the red, which snapped a five-day winning stretch for the blue-chip index.

Friday’s jobs report indicated the economic recovery remains on track. The unemployment rate slid to 5.8% from 6.1%. More importantly, the US labor market added 559,000 new jobs in May. The reading was embraced as encouraging by investors who piled into shares and lifted the main stock gauges.

Meme Stocks Start the Week Negatively

The May jobs report showed fewer jobs than economists had expected. Still, the data offered presented a key takeaway: the job market continues to improve, but not to the extent which will require the Federal Reserve to rethink its monetary policy and rush to scale back its support for the economy.

The Dow Jones Industrial Average gained 0.52%, or 179.35 points, finishing the session at 34,756.39. The S&P500 climbed 0.88%, or 37.04 points, ending at 4,229.89. The Nasdaq Composite was the best performer, up 1.47%, or 199.98 points, to end the week at 13,814.49. The Dow Jones rose 0.7% for the week, while the technology-driven Nasdaq Composite gained 0.5%.

Inflation data this week remains a crucial component of the rise of the economy. The US consumer prices report for May is set to arrive on Thursday. Economists expect another elevated number for the consumer-price index, following the surge in April. Consumer prices rose 4.2% in April, the most in any 12 months since 2008, largely the result of the ample fiscal and monetary stimulus that is being injected into the economy.

Meanwhile, shares of meme stocks, that were in the limelight last week, are negative in pre-market trading on Monday. AMC shares today are down roughly 9%, while GameStop stock is lower by about 1% ahead of the opening bell in New York. AMC slid 18% on Thursday, and 6.7% on Friday, but still ended the week higher by 50%, after it surged more than 90% on Tuesday on news that the company will be handing free popcorn to anyone who purchases its shares.

On the cryptocurrency front, Bitcoin traded largely subdued over the weekend. The world’s largest digital asset hovered in a narrow range of around $36,000 as crypto market participants are on the lookout for any news that could flare up another rally in the market after it got knocked down last month. In the first days of June, Bitcoin is still unable to stage a recovery and is trading in negative territory, down 1.1% month-to-date.