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Private payrolls data due before opening bell
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Futures down: Dow 0.06%, S&P 0.12%, Nasdaq 0.12%
(Updates prices, adds comment)
By Ankika Biswas and Amruta Khandekar
April 5 (Reuters) - U.S. stock index futures slipped on
Wednesday as investors awaited a fresh batch of economic data,
including a report on the labor market, amid worries that rapid
interest rate hikes by the Federal Reserve could trigger a steep
economic downturn.
Wall Street's main indexes ended lower in the previous
session, with the benchmark S&P 500 snapping a four-day
winning streak after a fall in U.S. job openings and factory
orders added to evidence that the Fed's aggressive monetary
tightening was starting to take a toll on the economy.
Focus will be on the ADP National Employment report before
the opening bell on Wednesday. The data is expected to show
private payrolls growth likely slowed in March.
Final data on the S&P Global Composite and Services PMI and
a report on non-manufacturing activity in March from the
Institute for Supply Management will also be on the watch list.
With growing concerns about a worsening economic outlook
following a turmoil in the banking sector, market expectations
have shifted in favor of the U.S. central bank hitting the
brakes on its interest rate hikes.
"Data coming from the manufacturing side of the economy
indicates (a) recession. So the equity market is left with weak
economic data and a still-hawkish Fed," said Paul Nolte, senior
wealth adviser and market strategist at Murphy & Sylvest.
"As long as the inflation data continues to show some
improvement and we start to see unemployment pick up a little
bit, the Fed will be on hold in May."
Traders' bets of a pause by the Fed in May stood at 53.9%,
while odds of a 25-basis point interest rate hike were at 46.1%,
according to CME Group's Fedwatch tool.
Both the benchmark S&P 500 and the tech-heavy Nasdaq are on track to notch their first weekly declines in four in the
holiday-shortened week.
At 7:05 a.m. ET, Dow e-minis were down 20 points,
or 0.06%, S&P 500 e-minis were down 4.75 points, or
0.12%, and Nasdaq 100 e-minis were down 15.75 points, or
0.12%.
Among stocks, Nvidia Corp fell 1.5% in premarket
trading after Alphabet Inc's Google said the
supercomputers it uses to train its artificial intelligence
models were faster and more power-efficient than comparable
systems from the chipmaker. Alphabet's shares were up 1.3%.
Johnson & Johnson gained 2.8% after placing its unit
in bankruptcy for a second time to pay $8.9 billion to settle
tens of thousands of lawsuits alleging that talc in its iconic
Baby Powder and other products caused cancer.
(Reporting by Ankika Biswas and Amruta Khandekar in Bengaluru;
Editing by Nivedita Bhattacharjee and Shounak Dasgupta)
