Traders based on the NYSE, February 24, 2022
Source: NYSE
Equity futures rose on Thursday night ahead of a key job report as investors followed the development of the war in Ukraine.
Dow Jones Industrial Average futures rose 53 points, or 0.2%. Those for the S&P 500 added 0.1%, while futures on the Nasdaq 100 rose 0.2%.
The moves come before the February report on the jobs of the Ministry of Labor. Economists polled by Dow Jones expect 440,000 jobs to rise and the unemployment rate to fall to 3.9 percent. Hourly wages are projected to increase by 5.8% on an annual basis.
This is the last report on jobs before the next meeting of the Federal Reserve, at which the central bank is expected to begin raising interest rates. Fed Chairman Jerome Powell said on Wednesday that he was in favor of an increase of 25 basis points in March. The base point is equal to 0.01%.
“I think that since we’ve seen Powell say, uncharacteristically frank, specifically that he plans to support a 25-point increase, that speculative thinking can be a little more anchored by raising 25 basis points, even if we see more “Stronger than expected tomorrow,” said Lauren Goodwin, an economist and portfolio strategist at New York Life Investments.
The wage growth component in the report could be a key data point as traders try to understand the path of road policy, Goodwin said.
“Even a 5.8% increase in wages is a reduction in wages if inflation creeps above 7%,” Goodwin said.
The war against Ukraine will also be in the minds of investors on Friday. Ukraine still holds its capital, Kyiv, more than a week after the fighting, although reports of shelling have increased in other major cities. One million Ukrainians have fled the country, according to the UN.
Meanwhile, economic sanctions from the United States and its allies have virtually cut off Russia’s economy from large parts of the global financial system. JPMorgan said in a note Thursday that Russia’s economy could shrink by 35% year-on-year in the second quarter.
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Profit reports have led to some major moves in expanded trade. Retailer Gap and restaurant chain Sweetgreen rose after expectations. Chipmaker Broadcom rose after outpacing earnings and revenue forecasts.
On Thursday, the three main averages closed lower after a volatile session. The Dow was positive for most of the day before closing 96 points lower. Nasdaq, pulled by software stocks, fell 1.56%.
The Dow was down 0.9% for the week, on its way to its fourth negative week in a row. The S&P 500 was down about 0.5% for the week, while the Nasdaq Composite was down more than 1%.