Wall Street futures muted as investors await key jobs data
NEW YORK: US stock index futures were muted on Thursday as investors looked ahead to the monthly jobs report to gauge the impact of President Donald Trump's trade policies on the labor market and the Federal Reserve's interest rate trajectory.
Following Wednesday's weaker-than-expected US private jobs and services sector data, Friday's non-farm payrolls report will come under sharp scrutiny as investors fear that Trump's erratic trade policies will drive a slowdown in economic growth.
"The numbers weren't so bad as to revive fears about a recession ... investors were reluctant to over-interpret one day's data, not least given the big test is coming tomorrow with the US jobs report," Jim Reid, global head of macro and thematic research at Deutsche Bank, said in a note.
"But, the data led investors to price in more rate cuts this year ... and there's growing confidence that we'll see the first rate cut by September."
The data comes ahead of the Fed's policy decision later this month, where policymakers are widely expected to hold interest rates. Traders currently see at least two rate cuts by the end of this year, as per pricing in money markets.
Despite continued calls from Trump to slash interest rates, Fed Chair Jerome Powell has opted to stand pat so far, awaiting further data to help dictate the policy decision as tariff volatility prevails.
On Wednesday, Washington's doubled tariffs on imported steel and aluminum came to effect and it also marked Trump's deadline for trading partners to make their best offers to avoid other punishing import levies from taking effect in early July.
Investors focused on tariff negotiations between Washington and trading partners, with Trump and Chinese leader Xi Jinping expected to speak sometime this week as tensions simmer between the world's two biggest economies.
US equities rallied sharply in May, with investors boosting the S&P 500 index and the tech-heavy Nasdaq to their biggest monthly percentage gain since November 2023, thanks to a softening of Trump's harsh trade stance and upbeat earnings reports.
The S&P 500 remains nearly three per cent below record highs touched in February.
Data scheduled for Thursday include initial jobless claims and international trade data at 8.30am ET.
US central bank officials including Fed Board Governor Adriana Kugler, Fed Kansas City President Jeffrey Schmid and Fed Philadelphia President Patrick Harker are scheduled to speak later in the day.
At 6.58am ET, Dow E-minis were up 15 points, or 0.04 per cent, S&P 500 E-minis rose 2.25 points, or 0.04 per cent, and Nasdaq 100 E-minis were higher 9.75 points, or 0.04 per cent.
Most megacap and growth stocks were mixed in premarket trading. Tesla fell 1.8 per cent.
Shares of MongoDB jumped 16.4 per cent after the software company gave an upbeat annual forecast and reported quarterly results above estimates.
Chewy fell 2.6 per cent after Jefferies downgraded the online pet products retailer to "hold" from "buy".
Hashtags
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
The Sun
2 hours ago
- The Sun
Senior Taiwan official visits site of new Alaska LNG project
TAIPEI: A senior Taiwanese official said on Saturday he had this week visited the site of a potentially enormous new liquified natural gas (LNG) project in Alaska that the Trump administration has been pushing hard to allies in Asia as a supply option. Energy developer Glenfarne had said on Tuesday that 50 firms had formally expressed interest in contracts worth more than $115 billion from its Alaska LNG project, a massive infrastructure deal championed by U.S. President Donald Trump. Writing on his Facebook page, Pan Men-an, secretary-general to Taiwan President Lai Ching-te, said he had attended an energy conference in Alaska at the invitation of U.S. Secretary of Energy Chris Wright and visited the state's North Slope. Phase One of the project is expected to deliver natural gas about 1,230 km (765 miles) from the North Slope to the Anchorage region. 'Despite the freezing temperatures, we talked enthusiastically about building resilience and responsibility as democratic partners in the face of global climate change and the challenges of authoritarianism,' Pan wrote. 'In the face of trade challenges and international turbulence, we have no choice but to rise to the occasion,' he said, without mentioning whether he had signed any deals while there. The presidential office said late on Friday that Pan had been accompanied by Fang Jeng-zen, chairman of Taiwan's state-owned energy company CPC. CPC in March signed a non-binding agreement to buy LNG and invest in the project, a move Taiwan's president has said would ensure the island's energy security. If built, the Alaska LNG project will export up to 20 million metric tons of the superchilled gas a year. It would open direct access for U.S.-made LNG to Asian markets without having to go through the Panama Canal or around the Horn of Africa, reducing transit time and costs. Taiwan has pledged to massively ramp up its purchases from the United States, including energy, to reduce a yawning trade surplus that has angered Washington.
The Star
3 hours ago
- The Star
Hong Kong's still ‘over' but Stephen Roach says city a surprise trade war winner
American economist Stephen Roach has said that Hong Kong has benefited from the US-China trade war despite last year having declared the city to be 'over', even as he claimed that other aspects of the financial hub had worsened. The former Morgan Stanley Asia chairman sparked debate last year after he penned an opinion piece which argued, in part, that Hong Kong would be caught in the 'crossfire' of the worsening US-China rivalry. 'The word caught is the word that, if I had to write the piece again, I would probably change, because I think, ironically, Hong Kong has benefited from the crossfire between the US and China,' he told the Post in a recent interview. Despite worsening ties between the two superpowers since US President Donald Trump began levying his so-called reciprocal tariffs on China and the rest of the world, Hong Kong's stock market has seen solid gains. The benchmark Hang Seng Index is up by around 50 per cent since Roach made his original claim, while Hong Kong has rocketed to the top of the global fundraising table following a string of high-profile initial public offerings last month, including from mainland Chinese battery maker Contemporary Amperex Technology. Roach, who is now a faculty member at Yale University, said the 'sell America' trade had become a 'global mantra' and Hong Kong was a beneficiary. But asked whether he felt his initial assessment of the city being 'over' was premature, he noted he would say the same again. 'No economy or city state is over ... but this image of a dynamic, powerful system as part of the 'one country, two systems' model, I think that's just as close to being over today as it was when I originally wrote the piece,' he said, referring to the city's governing principle. 'The governance story is still, I think, very much working against this notion of Hong Kong as a free, independent, autonomous city state. If anything, it's gotten worse.' Roach added that the strong performance of the city's stock market had 'instilled sort of a new swagger in Hong Kong bordering on denial'. He said there were 'questions that could be raised' about the city's independent rule of law, pointing to the departure of foreign non-permanent judges. He also raised concerns about the fast-tracking of the domestic national security law last year and what he described as continuing efforts to 'quash dissent'. While the Hong Kong government had 'risen to the challenge' to demonstrate to the world that the city should be considered 'special', American investors in particular had developed an 'unwillingness' to distinguish it from the rest of China, he said. 'Where I've come out, reluctantly, is that as great a city as Hong Kong is, it's just another big Chinese city,' he said. 'I think it's increasingly a one country, one system model with a solid financial capital raising infrastructure embedded in Hong Kong.' Executive Council convenor Regina Ip Lau Suk-yee, who previously hit back at Roach over his 'Hong Kong is over' remarks, maintained that the American economist did not understand the city. She said the 'pessimistic views' Roach expressed last year 'were primarily based on the Hong Kong stock market's poor performance'. 'He overlooked China's strength in technological innovations and Hong Kong's unique advantages based on its separate systems. We are the only part of China that can invest, manage and provide trading platforms for digital assets.' She cited the city's recently passed law on stablecoins, which she said would help Hong Kong be the country's 'testing ground' for cryptocurrencies. Stablecoins are a type of cryptocurrency token that maintain a fixed value by being pegged to a reference asset, typically fiat currencies such as the US dollar. The law, which was passed last month and is set to take effect later this year, establishes a regulatory regime for stablecoins, paving the way for issuers to obtain licences and sell the digital assets to the public. 'Despite ongoing US-China tensions, Hong Kong will continue to have an important role to play in building bridges between China and the West,' Ip said. - SOUTH CHINA MORNING POST
The Star
3 hours ago
- The Star
Is China's promise of a new world order a self-serving power play?
As China has found itself in the midst of a rapidly escalating trade war with the United States after President Donald Trump launched global tariff measures, Beijing launched a sweeping outreach strategy intended to strengthen ties with Russian and Southeast Asian trade partners while also welcoming Latin American and European stakeholders. The multifront diplomatic charm offensive has had at its core one clear message: a shift to a multipolar world is accelerating, and Beijing is ready to work with partners to defend the 'rules-based, UN-centred' international system that has underpinned economic globalisation since World War II. Beijing's message holds that the post-war order, once symbolised by multilateral cooperation, is now being challenged by Washington's retreat under the banner of 'America first'. Observers have watched as China has amplified this theme to court Europe and the Global South, framing itself as a defender of multilateralism and a responsible stakeholder in the post-war system in contrast to what Washington now offers. But the analysts have also cautioned that divergent world views and competing national interests – as well as the strategic calculations of countries seeking to balance or benefit from US-China tensions – could undercut Beijing's vision of a multipolar world. China has used its membership in diplomatic platforms, such as the United Nations and the World Trade Organization, to highlight its World War II sacrifices and contributions to the post-war international order. During a visit to Moscow last month, Chinese President Xi Jinping told his Russian counterpart Vladimir Putin that both sides should work together to defend their second world war legacies, as well as the rights of developing nations to pursue an 'equal and orderly' multipolar world. Victor Gao, vice-president of the Centre for China and Globalisation, said Beijing has been reminding the world of the origins of the post-war international system. 'The international order established in 1945 was not unilateral from the outset – it was built on multilateralism, centred around the United Nations,' he said. 'The US launch of a global tariff war ... deprives other countries' rights to development, which China opposes.' Since Xi came to power, China has advanced its vision of a multipolar world order through initiatives such as the Global Development Initiative (GDI), the Global Security Initiative, and the Global Civilisation Initiative – all aimed at providing an alternative to the Western development model. The Belt and Road Initiative has been central to these initiatives to empower developing economies, alongside the expansion of Global South-focused blocs such as Brics. At the China-Community of Latin American and Caribbean States (Celac) Forumlast month, Xi highlighted a 'shared identity' with the region, calling for 'independent development paths' and joint efforts to promote multipolarity and reform global governance. In a separate meeting with African diplomats, Foreign Minister Wang Yi invoked a 'common destiny' shaped by historical injustice. Similar themes were echoed during Xi's April visit to Southeast Asia, seen as a 'back door' for China's exports to circumvent trade restrictions from Washington, where he has prioritised neighbourhood diplomacy and supply chain resilience in response to US tariffs. Gedaliah Afterman, a Chinese foreign policy specialist at Israel's Reichman University, described Chinese advocacy for a multipolar world order as both 'ideological and strategic.' 'This narrative resonates across the Global South, where China positions itself as a champion of 'pluralism' and 'win-win cooperation',' he said. 'However, China's embrace of multipolarity is selective and self-serving. While it publicly promotes a world of diverse centres of power, in practice it seeks to structure this order in ways that amplify its own influence.' Through its trillion-dollar Belt and Road Initiative, China is expanding its footprint across developing regions, including Latin America, Africa, Southeast Asia and the Middle East. The areas have become key destinations for Beijing to diversify its exports and supply chains, while also offering access to critical minerals amid US export controls. Gustavo de Carvalho, a senior researcher on African governance and diplomacy at the South African Institute of International Affairs, said Latin American and African countries embrace China's multipolar vision where it provides 'tangible benefits', such as technology transfers, industrial upgrades and 'institutional alternatives'. Latin American and African countries including Brazil and South Africa – both Brics members – have often backed China's push to reform global governance in favour of Global South interests. But 'rather than endorsing any particular power's vision of world order', these countries have hedged their ties with the US and Europe alongside China amid the US-China rivalry, de Carvalho said. He cited African nations ramping up lithium and battery production to serve both Chinese and Western markets, and Latin American countries pursuing trade deals with the European Union while deepening their economic ties with Beijing. 'This represents calculated hedging rather than ideological conversion,' de Carvalho said. Similar hedging strategies have also been adopted by Middle Eastern countries, as they position themselves to benefit from a future multipolar structure, Afterman said. 'China has found receptive ground for its multipolar vision in the Middle East, especially among states seeking greater strategic autonomy from Washington,' he said. 'For Gulf monarchies and other regional actors, multipolarity is not about endorsing a new global order but about expanding strategic space. These countries seek to balance between the US, China, Russia and others to advance their national interests.' '[But] divergences become clear when China's vision intersects with contested regional dynamics or entrenched security architectures ... China's growing economic role is evident, but whether it has the will or capacity to assume a meaningful political or security role in the region remains an open question.' Many Middle Eastern nations have long been reliant on US security guarantees, and the region has returned to the forefront of Trump's 'America first' strategy. His recent visit to the region secured billions of dollars in AI-related investments – an arena of intense competition between Washington and Beijing. At last week's China-Asean Gulf Cooperation Council forum in Malaysia, Chinese Premier Li Qiang pledged to deepen regional economic integration, aiming to build a market where investment, technology and talent move freely. While many Southeast Asian nations have been open to China's call for a multipolar world, they have also been assessing whether Beijing was 'fully living up to' the ideals it has been pitching, especially when it comes to its approach on the South China Sea, according to Dylan Loh, a Chinese foreign policy specialist at Nanyang Technological University in Singapore. 'While [China] speaks of an equitable, multipolar and just world, [Southeast Asian] states are also assessing if this is the case. Its actions in the South China Sea, for instance, are seen by some as not fully aligning with some of the principles it espouses,' he said. Long-standing sovereignty disputes over the resource-rich region have strained China's relations with several Asean members. The contested waterway has also increasingly become a flashpoint for military tensions between China and US allies. Shi Yinhong, an international relations professor at Renmin University, said multipolarisation may offer smaller nations greater room to manoeuvre but also more pressure to choose sides. It remained doubtful that Trump's 'isolationism' would provide more room for China to increase its influence in the developing world, he added, noting that issues such as the South China Sea, Iran and Russia's war in Ukraine would continue to strain China's relations with Europe and the Global South. 'Apart from some limited and somewhat empty diplomatic gains, China's financial resources will be further squeezed, especially with that consumptive overseas involvement, if the Belt and Road Initiative has not been implemented effectively.' China has begun pivoting its belt and road spending toward more financially sustainable projects in green energy and hi-tech sectors as it continues to face economic headwinds. Many economists have predicted that sustained US tariffs would further slow its economy. Jo Inge Bekkevold, a Senior China Fellow at the Norwegian Institute for Defence Studies, said China's push for multipolarity has gained a lot of traction in the Global South, but less so in Europe. China has long seen the EU as a key pole in a multipolar world, urging Brussels to maintain 'strategic autonomy' as the bloc has aligned with Washington to counter Beijing's influence. EU-China relations have shown signs of thaw as transatlantic ties have been strained over Trump's tariffs and Ukraine policies. In a recent exchange of notes with European Commission President Ursula von der Leyen and European Council President Antonio Costa to mark 50 years of diplomatic ties, Xi called the EU a 'major force' in building a multipolar world alongside China. Bekkevold said Europe had not fully agreed with 'America's threat assessment of China' due to geographic distance, which has also allowed it more room to hedge and sustain economic ties with Beijing. At a May forum hosted by the EU delegation to China, European experts also pointed out that while Brussels and Beijing shared an interest in preserving UN-based multilateralism, their strategies and interpretations of it differed. When asked about possible EU cooperation with Brics, Justyna Szczudlik, deputy head of research and coordinator of the Asia-Pacific Programme at the Polish Institute of International Affairs, said Brics was 'China-led multilateralism', adding that the bloc had its 'own agenda' with the Global South. The EU has also diversified its global partnerships, recently signing a major trade agreement with the South American trade bloc Mercosur and pursuing a deal with India by year's end. According to Amit Ranjan, a China-India relations expert at the National University of Singapore, India saw multipolarisation as a way to gain influence in global governance. 'India also projects itself as an important player in world politics and world diplomacy. Therefore, India always calls for reformed multilateralism, because in the current multilateral structure, especially like the UN, it does not have a suitable space for New Delhi,' he said. Ranjan pointed to the UN Security Council, where India's bid for permanent membership has been blocked by China, which has been reluctant to share its status as the sole Asian permanent member amid concerns it could dilute Beijing's influence. Ranjan added that, like China, India has also considered itself a leader for the Global South and has been engaging with state players. Since 2023, India has hosted the annual Voice of Global South Summit with more than 100 nations taking part. It has long pushed back against China's dominance in Brics and the Shanghai Cooperation Organisation and has refused to endorse the Belt and Road Initiative. Additional reporting by Dewey Sim - SOUTH CHINA MORNING POST
