NEW YORK: Wall Street futures edged higher on Friday as investors awaited a key US employment report that is expected to influence the course of monetary policy, while strong forecasts from Microchip Technology and Atlassian buoyed sentiment.
Collaboration software maker Atlassian jumped 31.6% in premarket trading while chip company Microchip Tech advanced 8.9% after both forecast quarterly revenue above estimates.
The main US indexes were headed for strong weekly gains, with the S&P 500 and the Dow on track for their best week since April and the Nasdaq set for its biggest advance since May, if gains hold.
Better-than-expected results from AI-related companies this earnings season have propelled the Dow and the S&P 500 to fresh record highs, while helping the Nasdaq recover from a pullback that had briefly pushed it nearly 10% below its previous peak.
Cybersecurity company Cloudflare gained 16.1% after raising its full-year revenue forecast above estimates.
The results also lifted the broader sectors, with chip stocks Marvell and Micron up 2.4% and 1%, respectively.
Software stocks also rose; Palo Alto gained 2.2% and ServiceNow added 3.7%.
In a move to support domestic production, the White House imposed a series of price floors and a 15% tariff on products made from polysilicon, the raw material used in semiconductors and solar panels that is primarily produced by China.
Solar stocks also gained. First Solar was up 6.1% and SolarEdge climbed 1.5% following US president Donald Trump’s trade actions to challenge Beijing’s polysilicon monopoly.
At 6.56am, Dow E-minis rose 27 points, or 0.05%, S&P 500 E-minis gained 11 points, or 0.14%, and Nasdaq 100 E-minis were up 115 points, or 0.39%.
Eyes on jobs data
The labor department will release the nonfarm payrolls figures for July at 8.30am, with the economy expected to have added 80,000 jobs, up from the 57,000 the previous month.
The unemployment rate and average annual earnings are expected to stay steady from the month before at 4.2% and 3.5%, respectively.
“A stronger labor market would add to the notion that the economy remains resilient, which could support the case for a rate hike if inflation were to prove stubborn,” Erik Liem, rates strategist at Commerzbank, said in a note.
The US Federal Reserve under new chair Kevin Warsh has offered investors little information on forward guidance regarding monetary policy, sharpening the focus on economic data and commentary from policymakers.
The probability of no change versus an interest-rate hike in September is now closer to even, the CME FedWatch Tool showed. Last week, traders were pricing in a 37% chance for rates staying unchanged versus 63% for a rate increase.
Short-term Treasury yields, a reflection of short-term interest rate expectations, hovered above 4% as crude prices inched up above US$83 a barrel, adding to inflation concerns.
Tensions flared again after Yemen’s Iran-aligned Houthis attacked Saudi Arabia, while a report said Iran is reviewing a preliminary bill that would bar US, Israeli and other “hostile” vessels from transiting the Strait of Hormuz and would impose fines of up to 20% of a ship’s cargo value for violations.
Vacation rental company Airbnb gained 7.5% after beating second-quarter revenue estimates, helped by strong global demand for travel and a boost from first-time users during the Fifa World Cup.
