U.S. Stocks May See Further Upside Following Weaker Than Expected Jobs Data

(RTTNews) - After ending the previous session notably higher, stocks are likely to see further upside in early trading on Friday. The major index futures are currently pointing to a higher open for the markets, with the S&P 500 futures up by 0.3 percent.

The futures advanced following the release of a closely watched Labor Department report showing employment in the U.S. rose by much less than expected in the month of August.

The report said non-farm payroll employment crept up by 22,000 jobs in August after climbing by an upwardly revised 79,000 jobs in July.

Economists had expected employment to increase by 75,000 jobs compared to the addition of 73,000 jobs originally reported for the previous month.

The report also showed the uptick of 14,000 jobs that had been reported for June was downwardly revised to a decrease of 13,000 jobs.

The Labor Department said job growth in the healthcare and social assistance sector in August was partly offset by job losses in federal government and in mining, quarrying, and oil and gas extraction.

Meanwhile, the Labor Department said the unemployment rate inched up by 4.3 percent in August from 4.2 in July, in line with economist estimates.

While the report adds to recent signs of weakness in the labor market, the data is also likely to increase confidence the Federal Reserve will lower interest rates later this month.

CME Group's FedWatch Tool is currently indicating a 98.1 percent chance the Fed will lower interest rates by 25 basis points at its September 16-17 meeting.

Stocks moved notably higher over the course of the trading day on Thursday, with the major averages all showing strong moves to the upside after showing a lack of direction early in the session. With the upward move, the S&P 500 ended the day at a new record closing high.

The major averages finished the day just off their highs of the session. The Nasdaq jumped 209.97 points or 1.0 percent to 21,707.69, the S&P 500 advanced 53.82 points or 0.8 percent to 6,502.08 and the Dow climbed 350.06 points or 0.8 percent to 45,621.29.

In overseas trading, stock markets across the Asia-Pacific region moved mostly higher during trading on Friday. Japan's Nikkei 225 Index shot up by 1.0 percent, while China's Shanghai Composite Index surged by 1.2 percent.

The major European markets have shown more modest moves to the upside. While the U.K.'s FTSE 100 Index is up by 0.3 percent, the German DAX Index and the French CAC 40 Index are both up by 0.1 percent.

In commodities trading, crude oil futures are slumping $0.69 to $62.79 a barrel after falling $0.49 to $63.48 a barrel on Thursday. Meanwhile, after sliding $28.80 to $3,606.70 an ounce in the previous session, gold futures are jumping $36.60 to $3,643.30 an ounce.

On the currency front, the U.S. dollar is trading at 147.42 yen versus the 148.49 yen it fetched at the close of New York trading on Thursday. Against the euro, the dollar is valued at $1.1733 compared to yesterday's $1.1649.