Jobs Data on the Horizon: US Dockworkers Halt Strike – Market Movers

Market Update: US Stock Futures Steady Ahead of Nonfarm Payrolls Report

US stock futures remain stable as the market anticipates the critical nonfarm payrolls report set to be released on Friday. This report is expected to reflect a steady, though slowing, labor market just ahead of the Federal Reserve’s remaining meetings for the year. Additionally, dockworkers on the US East and Gulf Coasts have suspended a strike that could have significantly impacted the economy.

1. Nonfarm Payrolls Anticipated

The focus is on the nonfarm payrolls report for September, scheduled for release at 08:30 ET on Friday. Analysts expect the US economy to exhibit moderate job growth for the last month of Q3, with the unemployment rate predicted to hold steady at 4.2%—the same as August.

If the report aligns with these expectations, it could alleviate the Federal Reserve’s need for another substantial interest rate cut during its upcoming meetings in November and December. Last month, the Fed made a significant reduction in borrowing costs to support the labor market.

Hurricane Helene, which affected parts of the Southeast last week, and an ongoing strike by Boeing workers in the Pacific Northwest may influence the report. Overall, the data is anticipated to indicate a gradual slowing in labor demand, supported by generally consistent wage growth.

2. Stock Futures Unchanged

On Friday morning, US stock futures showed little movement as investors braced for the key jobs data. As of 03:27 ET (07:27 GMT), both Dow and S&P 500 futures were mostly flat, while Nasdaq 100 futures increased slightly by 25 points, or 0.1%.

The major indices concluded the previous session with modest declines, reflecting caution ahead of the payrolls report, compounded by rising tensions in the Middle East. The benchmark S&P 500 fell by 10 points (0.2%), the Dow Jones Industrial Average decreased by 185 points (0.4%), and the Nasdaq Composite slipped by 7 points (0.04%).

Analysts from Vital Knowledge noted that recent market trends were influenced by stimulus measures from China and various interest rate cuts from global central banks, which have helped mitigate significant downturns while also capping substantial gains.

3. Dockworkers End Strike

Dockworkers along the East and Gulf Coasts are set to halt their ongoing strike following an agreement reached between their union and representatives of major shipping companies. The work stoppage had previously affected ports from Maine to Texas and threatened critical supply chains, with estimates suggesting it could have cost the economy up to $4.5 billion daily.

The tentative agreement includes a wage increase of approximately 62% over six years, which lies between the demands of the International Longshoremen’s Association and the offers from the United States Maritime Alliance. Although a master contract extension is planned until January 15, key concerns remain regarding automation and potential job losses.

Following the announcement, shares in shipping companies experienced declines, reflecting investor disappointment over the anticipated rebound in freight rates amid the strike.

4. Seven & i Holdings Consider Sale of Supermarkets

Japan’s Seven & i Holdings is reportedly contemplating the sale of a majority stake in its supermarket operations, including the prominent Ito-Yokado division. The company, known for its 7-Eleven convenience stores, is looking to attract interest from foreign investment funds, with a potential sale process starting by the end of this year.

While a spokesperson indicated that no official announcements have been made, the company did previously reject a significant takeover offer from Alimentation Couche-Tard valued at $38.5 billion.

5. Oil Prices Increase

Oil prices have seen a slight uptick, positioning themselves for the largest weekly gain in over a year, largely due to increasing geopolitical tensions in the Middle East. As of 03:28 ET, Brent crude rose by 0.4% to $77.96 per barrel, while US crude futures (WTI) increased by 0.5% to $74.06 a barrel. Brent crude futures are on track for an approximately 8% weekly gain, marking the steepest rise since February, while US crude prices are also poised for a similar increase, the largest since March of the previous year.