Futures edge lower on caution ahead of key payrolls data By Reuters

(Reuters) – U.S. stock index futures slipped on Friday ahead of a crucial labor market report, at a time when concerns around inflation and the incoming Trump administration’s policies have clouded the Federal Reserve’s monetary policy outlook.

At 5:31 a.m. ET, Dow E-minis were down 48 points, or 0.11%, E-minis were down 15.75 points, or 0.26% and E-minis were down 70.5 points, or 0.33%.

Elevated Treasury yields also added to investor nervousness, with those on the 10-year benchmark near eight-month highs at 4.69%.

All eyes are on the Labor Department’s non-farm payrolls report, due at 8:30 a.m. ET, after a set of jobs data earlier in the week painted conflicting views about the state of employment.

Friday’s data is expected to show the economy added 160,000 jobs in December, with unemployment staying steady at 4.2% from the month before.

Later in the day, investors will also assess the University of Michigan’s preliminary report on consumer sentiment for January.

Wall Street’s main indexes are poised to close their second consecutive week in the red, with the benchmark S&P 500 down nearly 3% from its record high hit a month ago.

Fresh inflation worries have taken the spotlight, compelling the Fed to issue a cautious forecast on monetary easing last month, as it anticipates policy changes on trade and immigration under President-elect Donald Trump, who is expected to take office in 10 days time.

Multiple reports on his plans, including one on imposing a national economic emergency to fast track tariff implementation, have left investors on edge about their potential impact on the economy and global trade.

The index, tracking domestically focused small-cap companies, has lost over 8% from its record high hit in late November. Futures tracking the index dipped 0.4% on Friday.

On Thursday, voting members on the Federal Open Market Committee, including Boston Fed President Susan Collins and Kansas City Fed President Jeff Schmid, voiced the need for a measured approach to lowering borrowing costs this year.

Traders see the central bank leaving interest rates steady for much of the first half of 2025, according to the CME Group’s (NASDAQ:) FedWatch Tool.

Among premarket movers, chip stocks such as Nvidia (NASDAQ:) lost 1.1% and Advanced Micro Devices (NASDAQ:) dropped 2.2% after a report said the U.S. could announce new export regulations as early as Friday.

U.S.-listed shares of TSMC added 1.3% after the world’s largest contract chipmaker reported fourth-quarter revenue above market forecasts as it reaped the benefit of artificial intelligence demand.

Quarterly reports from Walgreens Boots Alliance (NASDAQ:), Constellation Brands (NYSE:) and Delta Air Lines (NYSE:) are on tap before markets open.

Earnings reports will pick up next week and investors wait to hear the possible impact the incoming government’s policy proposals could have on companies, along with insights into the resilience of the consumer and the U.S. economy.