US Futures Inch Higher; NFP Expected to be Weaker than October; Unemployment Rate Could Surprisingly Rise

The major U.S. equity futures indexes are inching higher on Friday on weak volume with most major players sitting on the sidelines ahead of a key November jobs report that should offer investors a look at the pace of the labor market recovery in the face of a worsening pandemic.

At 07:27 GMT, December E-mini S&P 500 Index futures are trading 3672.50, up 8.00 or +0.22%. December E-mini Dow Jones Industrial Average futures are at 29988, up 55 or +0.18% and December E-mini NASDAQ-100 Index futures are trading 12506.50, up 44.25 or +0.36%.

Pace of Job Gains Likely Slowed in November

Economists believe the rate of job gains in November are expected to be weaker than in October, reflecting the impact of virus-related shutdowns by states and local governments due to the record spread of COVID-19.

The U.S. economy is expected to have added 440,000 jobs, compared to 638,000 in October according to Dow Jones. The unemployment rate is estimated to have decreased to 6.7% from 6.9%.

The big surprise in this Non-Farm Payrolls report could be in the unemployment rate so traders should brace for two-sided price action. This occurs when the payrolls number is bullish and the unemployment rate is bearish, or vice-versa.

NASDAQ Hits Record High, S&P 500 Ends Lower

The NASDAQ Composite Index closed at a record high on Thursday, lifted by Tesla Inc, while the S&P 500 fell after a report that Pfizer Inc had slashed the target for the rollout of its COVID-19 vaccine.

In the cash market on Thursday, the benchmark S&P 500 Index settled at 3666.72, down 2.29 or -0.07%. The blue chip Dow Jones Industrial Average finished at 29969.52, up 85.73, up 0.31% and the technology-based NASDAQ Composite closed at 12377.18, up 27.81 or +0.25%.

Stocks in the News

Tesla surged 5% after Goldman Sachs upgraded the stock to “buy” in the run-up to the electric car maker’s addition to the S&P 500 Index.

Boeing Co jumped after budget airline Ryanair orders 73 additional 737 MAX jets with a list price of $9 billion, throwing a commercial lifeline to the embattled U.S. planemaker.

Tesla was Wall Street’s most traded stock by value, with about $25 billion worth of shares exchanged, according to Refinitiv data, more than double Boeing, in second place.

The benchmark S&P 500 Index fell from all-time highs late in the session after the Wall Street Journal reported that Pfizer faced supply chain obstacles related to the vaccine, sending its stock down 1.7%.

Broad vaccine optimism helped lift the S&P 1500 airlines index 4%. Cruise operators Carnival Corp and Norwegian Cruise Line Holdings Ltd both surged more than 8%.

Cloud-security provider Zscaler Inc rallied over 26% after it reported better-than-expected first-quarter revenue and adjusted profit.