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Futures Lurch Higher After Bullish Labor Market Report

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Fueled by a bullish labor market report, stock futures on Wall Street lunged higher Friday and trimmed earlier gains to set Dow and S&P futures back in the green leading into Friday’s open. The Nasdaq remains negative, weighed down by Amazon (AMZN).

The US economy created 304,000 new jobs in January, almost twice what Wall Street expected. Although December’s blowout number was revised down to 222,000 from 312,000, there was plenty of good news in the report to dispel fears of an impending recession. Private payrolls were up 296,000 and the participation rate improved to 63.2 from 63.1. Additionally, average hourly earnings increased just 0.1%, cooling inflationary jitters among investors.

Heading into the data, stock futures were trading lower as underwhelming progress towards a US-China trade deal coupled with disappointing guidance from Amazon weighed on sentiment. Following the lead of European bourses on the heels of downbeat Chinese and European manufacturing data, the major market indices were all indicated to open lower with the Nasdaq lagging until the jobs report gave Wall Street a shot in the arm.

After the close Thursday, Amazon reported better-than-expected results for the fourth quarter, but issued Q1 guidance that was shy of Wall Street’s expectations. Additionally, the company’s CFO alerted investors as to the regulatory roadblocks in India as well as the burden of increased investments.

Friday’s remaining data includes the January ISM manufacturing index, the final January University of Michigan consumer sentiment index, and November wholesale inventories.

After the opening bell, Dallas Fed president Rob Kaplan will participate in a Q&A in Austin.

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