By Anna Hirtenstein
U.S. stock futures clung to their early gains after disappointing jobs data showed employers added 266,000 jobs in April, badly missing expectations.
Futures tied to the S&P 500 ticked up 0.4%, a day after the broad-market index closed near its all-time high. Nasdaq-100 futures advanced 1.3%, with gains accelerating after the jobs data was released. Futures linked to the Dow Jones Industrial Average slipped 0.1%, paring their early gains.
The yield on the 10-year Treasury note edged down to 1.509%, from 1.561% on Thursday, on track for a sixth consecutive day of declines.
The monthly jobs report also showed the unemployment rose to 6.1%. These figures significantly missed the expectations of economists who estimates that payrolls grew by one million and the unemployment rate fell to 5.8%. It sat at a record 14.8% in April 2020 in the midst of the early stages of the pandemic.
Still, stocks are poised for a second week of muted gains, with sentiment bolstered by signs of a strengthening economy and Federal Reserve officials reiterated pledges to refrain from tightening monetary policy until the labor market is recovered. Energy producers, banks and other firms that would benefit from the economy reopening have rallied this week, while technology firms have been among the poorest performers.
"This week was really still a combination of the post-Covid recovery and how interest-rate policy will respond," said Kiran Ganesh, a multiasset strategist at UBS Global Wealth Management. "The performance of some cyclical stocks and commodities suggests that this reopening trade is still on track."
Investors are "trying to gauge the extent to which policy makers are going to keep monetary stimulus in place and whether we're tipping over into the stage where good economic data starts to be a problem for financial markets because it brings forward the time the central banks start very tentatively tightening policy," said Sebastian Mackay, a multiasset fund manager at Invesco. "I think we're getting there."
Earnings season continues, with self-driving truck company Nikola among those reporting Friday.
"We're still in a cyclical upswing, which should drive equities higher on average," Mr. Mackay said. "On average, most of the earnings numbers have been at or above expectations. It is about delivery of those expectations of earnings needed to sustain equities."
Ahead of the opening bell, Peloton rose almost 6% after reporting a smaller quarterly loss than analysts expected and sales that more than doubled. Travel-booking website Expedia added 5% after also reporting a narrower loss than Wall Street forecast. Energy drinks maker Monster Beverage fell over 5% after reporting first-quarter earnings that missed estimates and a shortage of aluminum cans.
In commodities, copper prices surpassed their 2011 highs and were on course to close at a record, fueled by bets on the global economic rebound and on rising demand from efforts to decarbonize the power and transportation sectors. Three-month copper forwards rose 2.4% to $10,355 a metric ton on the London Metal Exchange. In New York, copper futures on CME Group's Comex rose 2.5% to $4.72 a pound.
Overseas, the pan-continental Stoxx Europe 600 climbed 0.5%.
The Shanghai Composite Index pulled back 0.7%, and Japan's Nikkei 225 advanced 0.1%.
Gunjan Banerji contributed to this article.
Write to Anna Hirtenstein at firstname.lastname@example.org
Corrections and Amplifications
This article was corrected at 9:05 a.m. ET because it misstated that the monthly jobs report showed employers added 266,000 jobs in March. The monthly jobs report showed employers added 266,000 jobs in April.
(END) Dow Jones Newswires