US futures are choppy, trading between unchanged and modestly higher, ahead of today's jobs report which sees a modest increase in August payrolls (but the risk is for another negative print, see our preview here). As of 8:00am ET, S&P futures are flat and Nasdaq futures gain 0.5% as Mag 7 stocks trade mixed premarket, with NVDA (+1.
4%) and AMZN (+0.7%) leading and TSLA (-2.1%) lagging.
Bond yields are steady as traders wait to see whether Friday’s payrolls report will offer the Fed enough justification to hold off on an interest-rate hike in September. The USD is 20bp higher as the yen drops after yesterday's surge. Commodities are mixed: oil fell, while base metals and Ags are both higher.
Overnight, macro headlines were largely muted following yesterday’s bond market rally after Waller’s comments. All eyes are on the 8:30am ET NFP release (see our preview here), but investors are increasingly more focused on next week’s CPI than the payroll number, given Warsh’s assessment of the labor market and Waller’s comments yesterday.In premarket trading, Mag 7 stocks are mixed: Tesla falls 2% as the electric-car maker’s invite-only, closed-door Cybercab launch event resulted in little splash.
Nvidia +1.1%, Amazon +0.5%, Meta +0.
5%, Alphabet +0.3%, Microsoft -0.3%, Apple -0.
3%Adobe (ADBE) falls 3% after naming Anil Chakravarthy as its next chief executive officer, thrusting the company veteran into a challenging competition with artificial intelligence upstarts.Asana (ASAN) falls 10% after the software company gave an outlook that was seen as disappointing.Equifax (EFX) falls 5% and TransUnion (TRU) slips 6% after US Federal Housing Finance Agency Director Bill Pulte issued renewed criticism of credit bureaus for overcharging Americans.
Guidewire Software (GWRE) falls 15% after the company gave a first-quarter forecast that was weaker than expected on key metrics, including revenue and adjusted operating profit. Analysts said the outlook could be conservative.Planet Labs (PL) rises 12% after the satellite-imaging service firm reported second-quarter revenue that beat the average analyst estimate and lifted the low end of its full-year revenue outlook for 2027.
Samsara (IOT) climbs 14% after the fleet management technology provider boosted its guidance for this year’s total revenue and adjusted earnings per share. The ranges for both metrics topped analyst estimates.In other corporate news, Tesla’s much-anticipated Cybercab launch, an event nearly two years in the making, resulted in little splash or detail as the two-seat vehicle was added to the company’s robotaxi fleet.
Lululemon comparable sales fell 9% in the second quarter and lowered its full-year outlook for a second straight quarter, signaling deep challenges for incoming CEO Heidi O’Neill. Speaking of ECM, health and fitness ring-maker Oura filed for an IPO, showing soaring revenue. Its listing could raise as much as $3 billion, based on prior Bloomberg News reports.
While market volatility remains subdued, with the VIX matching its lowest reading of the year, things promise to get livelier post the Labor Day holiday, however, and next week looks busy according to BBG. The traditional fall conference season kicks off, with hundreds of corporates presenting across the country, and there’s a CPI inflation print and a possible massive AI IPO filing to keep traders occupied.The August jobs report arrives at a time when the odds of a quarter-point Fed hike this month are roughly even.
While Fed Chair Kevin Warsh last week emphasized that policymakers’ focus is firmly on inflation, the employment report could help buy them time to assess whether current policy is restrictive enough to bring price pressures under control. Economists estimate the report will show a 55,000 increase in payrolls after an unexpected dip in July employment. Such a result would be broadly in line with average job growth this year.
The unemployment rate is seen holding at 4.1% (full preview here).One of the major events on the calendar over the next few weeks is likely to move markets and close the implied-realized gap, but for now short-dated index optionality looks more like a sell than a buy.
The option implied SPX swing around NFPs is priced about the same as last month, when the 0.55% option-implied move ended up being very close to the realized move of 0.62%.
“The market needs a result weak enough to give the Fed a reason to keep interest rates unchanged, but not so weak that it intensifies concerns about a recession,” noted Linh Tran at XS.com. “Stronger-than-expected employment and wage growth could push yields higher again and weigh on equities.
” By contrast, figures close to expectations and accompanied by moderating wage growth would create favorable conditions for the S&P 500 to retest its record high, Tran said.JPMorgan’s Market Intelligence desk expects a “Good news is bad news” environment for market reaction to the print in most outcomes, with a Goldilocks scenario in the 30k to 70k range.Bloomberg Economics’ Anna Wong expects the payrolls number to undershoot consensus, citing a pattern of the data disappointing in August.
JPMorgan’s Market Intelligence desk sees a Goldilocks scenario in the 30,000-to-70,000 range. “We are in the territory where bad news is good news, as both equities and credit are likely to be driven by what rates do,” said Mohit Kumar at Jefferies. “A small positive number would be a sweet spot for the markets.
”In AI news, the launch of a new Astra model sent OpenAI proxy SoftBank’s shares soaring in Tokyo trading. Astra benchmark scores of AGI — where artificial general intelligence surpasses human capabilities - gives OpenAI confidence to claim it has overtaken Anthropic on some measures. DeepSeek is planning to power a new data center with an order for one of the largest known clusters of Huawei AI chips as part of China’s efforts to replace Nvidia.
Elsewhere, Anthropic is set to finalize an expansion of its revolving credit facility to $15 billion, clearing a hurdle before a public filing by the AI firm for its highly anticipated IPO. In other assets, trading in yen call options against the dollar expiring this month was more than two-and-a-half times the volume of puts on Thursday, CME data shows. It’s part of a rush to unwind yen-funded carry trades, while the latest positioning data from CFTC data suggests scope for further short covering.
Europe’s Stoxx 600 edged higher 0.1%. Volkswagen AG rose as much as 9.
7% after a major restructuring announcement. Here are the biggest movers Friday:Volkswagen shares gain as much as 9.7%, the biggest intraday move since March 2023, after the carmaker’s supervisory board backed a sweeping restructuring that includes 50,000 additional job cutsContinental shares rise as much as 4%, the most in two months, after Oddo BHF upgraded the tire maker.
Analysts said the company is one of the most profitable within the sectorAT&S shares rise as much as 10%, extending a huge year-to-date rally, after Oddo upgraded the printed circuit board maker to outperform, saying new contracts should maintain momentumAccor shares gain as much as 3.2% as Morgan Stanley upgrades the hotelier to overweight, naming it a top pick among the travel and leisure companies it coversVodafone gains as much as 2.3% after Goldman Sachs upgraded its view on the company to buy from sell in a wider review of the European digital infrastructure and telecoms sectorStudsvik gains as much as 8.
1%, after the founder and CIO of US hedge fund Segra Capital Management bought shares in the Swedish nuclear technology companyOxford Nanopore shares drop as much as 12% after one of its investors, Novo Holdings, offered shares at a hefty discount to Thursday’s closeKuehne+Nagel shares fall as much as 2.5% after being downgraded to underweight from equal-weight at Morgan Stanley, which sees better execution as priced in and downside risks to EbitNavitas Petroleum and Rockhopper Exploration are trading lower t