Investing.com – Wall Street futures pointed to a flat to lower open, paring initial losses sparked by the first U.S. military strike of Donald Trump’s presidency, as investors appeared to take the incident in stride and looked ahead to the outcome of the U.S.-China summit and the employment report.
The blue-chip Dow futures slipped 6 points, or 0.03%, by 6:59AM ET (10:59GMT), the S&P 500 futures dipped 2 points, or 0.06%, while the tech-heavy Nasdaq 100 futures inched down 2 points, or 0.04%.
Trump ordered a cruise missile attack against a Syrian airfield on Thursday night after accusing Bashar al-Assad’s regime of using chemical weapons to kill scores of civilians, an act Trump called “an affront to humanity.”
A spokesperson for Vladmir Putin said the Russian President regards the U.S. attacks on Syria as an aggression against a sovereign state in violation of the norms of international law that would deal a significant blow to relations between Washington and Moscow, raising concern over U.S.-Russia relations.
The order of the missile attack on Syria in what was the Trump administration’s first military strike initially jolted financial markets when the news broke with global equities taking a downturn and investors piling into safe haven assets such the yen, gold and U.S. 10-year Treasuries, though nerves appeared to calm as news developed and global stocks along with U.S. futures were already off session lows in early-morning trade stateside.
In other geopolitical news, market players were keeping an eye on the meeting of Presidents from the U.S. and China.
After the leaders of the world’s two largest economies underwent their first formal dinner a day earlier, they will begin wading through discussions of trade and foreign policy on Friday.
According to Xinhau News, Chinese President Xi Jinping has shown himself willing to work together with Trump to forge new ties and push forward cooperation on investment, infrastructure and energy.
On Friday’s macro calendar, all eyes will focus on the U.S. Labor Department’s March employment report at 8:30AM ET (12:30GMT).
The consensus forecast is that the data will show jobs growth of 180,000, following an increase of 235,000 in February.
The unemployment rate is forecast to hold steady at 4.7%, while average hourly earnings are expected to rise 0.2% after gaining the same amount a month earlier.
With the U.S. labor market widely considered to be at, or near, full employment by analysts and Federal Reserve (Fed) officials alike, the March employment report released on Friday may see a lackluster reaction in markets even if the data ends up weaker than expected.
Independently of whether the outcome will impact the Fed’s outlook for the future path of monetary policy, with officials expecting two further hikes in 2017 and balance sheet normalization to begin “later this year”, markets placed the odds at around 62% for the first rate increase to occur in June, according to Investing.com’s Fed Rate Monitor Tool.
However, despite that some analysts are calling for a second rate hike in September, Fed fund futures put the chances at only 35%.
On the company front, no major firms are reporting earnings Friday with investors looking ahead to the unofficial kickoff of the first quarter season next Thursday when both JJ.P. Morgan (NYSE:JPM) and Citi (NYSE:C) release their numbers.
Meanwhile, although news of the U.S. attack on Syria initially sentoil prices soaring more than 2% on concerns the military intervention could disrupt supply, they have since pared gains as investors appeared to take the possibility off the table.
U.S. crude futures gained 0.85% to $52.14 by 6:59AM ET (10:59GMT), while Brent oil rose 0.62% to $55.23.
In the meantime, market participants will turn their attention to Baker Hughes rig count for details on U.S. drilling activity later on Friday.
Last week, the oilfield services firm reported its U.S. rig count rose by 10 to 662, it was the eleventh straight weekly increase.