Stock futures rise ahead of April 1st session, says jobs report

US stocks were firmly in the green on Friday morning as investors looked ahead to a new month of trading and pondered fresh data from Washington on the state of the labor market.

The S&P 500, Dow Jones Industrial Average, and Nasdaq Composite all rose more than 0.3% after closing March’s final trading lower to mark their worst quarter since the beginning of 2020.

Investors on Friday are watching closely The monthly jobs report of the Ministry of Labor. Latest snapshot of strength in employment across the US economy. US employers added 431,000 jobs in March. Economists were unanimously looking to increase nonfarm payrolls by 490K, according to Bloomberg data, slowing from February’s gain of 678K, but still an increase well above pre-pandemic trends. The unemployment rate fell to 3.6% compared to an expected 3.7% – the lowest level since February 2020.

Stocks are moving forward in April after a volatile month and quarter of trading. The S&P 500 and Dow are down more than 4.5% for the first three months of 2022, closing their worst quarter — and first quarterly declines — since the first quarter of 2020. The Nasdaq Composite saw the biggest drop, dropping 9.1% over the year. The past three months, as investors shy away from the technology and growth stocks that drove the market higher last year.

April has historically been a strong month for stocks, and has actually produced a positive return for the S&P 500 in 15 of the past 16 years, according to Ryan Detrick of LPL Financial. But this time, stocks are facing a variety of headwinds that could tip this historically positive seasonality.

Namely, a confluence of concerns about the geopolitical and macroeconomic background contributed to the worst quarterly performance of stocks in two years, and is yet to be fully resolved. Geopolitical risks have risen since Russia’s invasion of Ukraine in late February, raising the specter of more crises for global supply chains already struggling to recover from pandemic-era turmoil. The widespread rise in prices, and in oil and energy prices in particular, has heightened concerns about consumer resilience – the main driver of the domestic economy – going forward. The Federal Reserve has begun a protracted process of raising interest rates and tightening financial conditions in a market accustomed to easy monetary policy since 2020.

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Robert Cantwell, Upholdings Portfolio Manager, told Yahoo Finance Live on Thursday, “I think investors are very happy that the quarter is over. It’s been a tough quarter. It’s clear that inflation has been bad all the way through to…the end of the quarter.” . “In all likelihood, over the next four to six weeks, the bad news will likely continue because inflation continues, and we continue to have record growth rates from the first four months of last year.”

“However, as you get into the second half of the next quarter, you can see a scenario where growth rates start accelerating again while inflation weakens, and that has the potential to bring a lot of the bulls back into the market,” he added. .

LPL Financial indicates that corporate earnings may be another component driving the recent recovery in stocks. Even in the face of war in Eastern Europe and high inflation for decades, earnings have held, and estimates of the S&P 500 index’s earnings per share over the next four quarters are higher in March. Although not at 1.5%, a positive outlook is significant under these circumstances – especially when compared to the performance of other countries. Inflation increases profits for large companies as companies have greater pricing power because they pass on higher costs to customers.

“Against the background of energy independence, the earnings trajectory of US companies has not been affected by rising energy costs and high inflation so far,” noted Jeffrey Bushbender, equity financial analyst at LPL, adding that, on the contrary, earnings expectations in international markets declined in March. “The US earnings outlook is the envy of the world right now.”

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Elsewhere on the corporate front, meme-stock favorite GameStop has been revealed in a file Form 8-K has been filed with the SEC After Thursday bell that The video game retailer will seek approval for a stock split at the next shareholder meeting. GME is following a growing list of top companies – Alphabet, Amazon and Tesla – it’s what it could be”Summer of stock split. “A stock split is an institutional measure taken to improve trading liquidity and make stocks more affordable without affecting the market value. GME is up up to 20% in trading extended to a 4-month high of more than $200 per share following the news.

9:30 a.m. ET: Inventories rise after March jobs report

Here are the main moves in the markets at the open on Friday:

8:30 a.m. ET: New payrolls come in less than expected

The The US economy made another big payroll gain in March As the labor market extends its strong and rapid recovery to re-employment to pre-pandemic levels. US employers added 431,000 jobs, less than the expected 490,000 jobs.

Meanwhile, the unemployment rate fell more than expected by 20 percent, coming closer to the historical low of 3.5 percent seen in February 2020, Mark Hamrick, chief economist at Bankert, noted, but noted that the labor force participation rate is not It is still less than the pre-pandemic level by one percentage point.

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Labor force participation rose slightly to 62.4% after an unexpected jump to 62.3% in last month’s data that indicated more individuals are returning to look for work or be placed in jobs after COVID-19 sidelined.

“Other than the positive snapshot for March, the outlook for next year is for more moderation in job creation,” Hamrick said in a note. “Encouraged by excessively high inflation, a hawkish Fed feels compelled to apply the brakes. It is hard to imagine how tightening ultimately does not affect the labor market.”

7:14AM ET Thursday: Futures prices rise to start trading in April

Here are the main movements in futures trading ahead of Friday’s opening:

  • S&P 500 futures contracts (ES = F.): +22.00 points (+0.49%) to 4552.75

  • Dow futures contractsYM = F.): +172.00 points (+0.50%) to 34790.00

  • Nasdaq futures contractsNQ = F.): + 80.00 points (+0.45%) to 14,948.75

  • raw (CL = F.): +0.14 dollars (+0.14%) to 100.14 dollars per barrel

  • gold (GC = F.): – $21.90 (-1.12%) to $1,932.10 per ounce

  • Treasury for 10 years (^ degeneration): 0.00 basis points to produce 2.3270%

6:12PM ET Thursday: Stock futures open slightly higher

Here is where the major stock index futures opened on Thursday night:

  • S&P 500 futures contracts (ES = F.): +12.5 points (+0.28%) to 4543.25

  • Dow futures contractsYM = F.): +100 points (+0.29%) to 34718.00

  • Nasdaq futures contractsNQ = F.): +51.75 points (+0.35%) to 14,920.50

NEW YORK, NY – MARCH 28: Traders work on the floor of the New York Stock Exchange (NYSE) on March 28, 2022 in New York City. After a positive week for stocks, the Dow Jones Industrial Average fell more than 100 points in morning trading. (Photo by Spencer Platt/Getty Images)

Emily McCormick is a reporter for Yahoo Finance. Follow her on Twitter.

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