Friday April 1st

1-04-2016

Futures hold lower amid jobs data

U.S. stock index futures indicated a lower open on Friday morning as traders digested the March jobs report and several other pieces of data. The employment report showed creation of 215,000 jobs, with the unemployment rate edging up to 5.0 percent and average hourly earnings rising seven cents, according to Reuters. "On balance this is a very strong number," said Art Hogan, chief market strategist at Wunderlich Securities. "I think it's going to be good news." However, he noted that other data, including ISM manufacturing and construction spending are due later in the morning. Vehicle sales are also set for release. The U.S. dollar index turned higher after the jobs report. The index posted a four-day losing streak on Thursday and fell 4.1 percent in the first quarter, its worst quarter since 2010. U.S. crude oil futures held more than 2.5 percent lower just above $37 a barrel. Treasury yields edged higher, with the 2-year yield at 0.76 percent and the 10-year yield at 1.80 percent. Dow futures pared losses slightly to hold about 50 points lower, while S&P and Nasdaq futures were also slightly lower. 205,000 jobs were expected to be have been added in March, according to a survey of economists conducted by Reuters. Asian markets started the new quarter on the back foot Friday, trading lower despite better-than-expected China manufacturing surveys, as a reading on Japan's economy disappointed and traders awaited U.S. nonfarm payrolls data later. The Nikkei 225 took a tumble in Friday's session and closed down 3.55 percent, or 594.51 points, at 16,164.16, as markets digested the Bank of Japan's Tankan survey. The survey saw big manufacturers' business sentiment at its lowest in nearly three years, and it's set to weaken in the second-quarter, reported Reuters. Chinese markets were mixed, with the Shanghai composite closed up 0.17 percent, or 5.0645, at 3,008.979 and the Shenzhen composite closed down 0.56 percent, or 10.694 points, at 1,901.515. Hong Kong's Hang Seng index closed down 1.34 percent, or 277.78 points, at 20,498.92. Oil futures sank more than 2 percent on Friday to below $40 per barrel, with the market growing increasingly skeptical that a looming deal to freeze crude production can help clear a global glut. Brent crude for June delivery fell 95 cents, or 2.4 percent, to $39.38 a barrel by 8:32 a.m. ET (1232 GMT). The May contract, which expired on Thursday, settled up 34 cents at $39.60 a barrel. Brent rose 6 percent in the first quarter, its first such increase since a 15 percent rally in the second quarter of 2015. U.S. crude fell 91 cents, or 2.4 percent, to $37.43 a barrel after settling up 2 cents on Thursday. Prices rose almost 4 percent from January through March, also the first quarterly gain since surging nearly 25 percent in the second quarter of last year. Gold extended initial losses of Friday after a report showed the U.S. economy added more jobs than expected last month. The U.S. economy added 215,000 jobs in March, the Bureau of Labor Statistics said. Economists polled by Reuters expected the economy to have added 205,000 jobs. Spot gold was $1,228.56 an ounce, down 0.27 percent, while U.S. gold futures for June delivery were down $5.10 an ounce at $1,230.50. The metal is sensitive to moves in U.S. rates, as a rise would lift the opportunity cost of holding non-yielding assets like bullion, while boosting the dollar. Gold has risen 1.4 percent this week after Fed Chair Janet Yellen said the U.S. central bank should proceed only cautiously with further interest rate increases.