US equity index futures traded higher on Friday, suggesting a fourth consecutive risk-asset ascend, as investors stood optimistic in respect to the prospect of an impending trade deal between the United States and Mexico, which comes in the run-up to a pivotal American jobs report, scheduled for release today at 8:30am EST.
All eyes will be on the US employment report for clues on the strength of the US economy, after Federal Reserve Chairman, Jerome Powell, had signaled his willingness to ‘act appropriately to sustain expansion’ earlier this week, as trade tensions persist.
Wall Street will be pricing in a 93% chance of a rate cut by September, Fed fund futures show, with data from the Bureau of Labor Statistics expected to show the US economy to have added 185,000 new jobs last month, with an average hourly wage rise of 0.3%.
Meanwhile, a potential international breakthrough in “very good” talks between US and Mexican officials had helped stocks record accelerated gains yesterday, with Vice President, Mike Pence, calling the second day of meetings “encouraging” and describing “some movement” on the part of the Mexican side.
The S&P 500 ended +0.65% higher, following a Bloomberg report that US officials are considering delaying tariffs on Mexican imports to allow for further talks. The Nasdaq Composite also picked up steam, rising +0.79%.
US-Mexico trade talks are set to resume Friday, with Pence saying his country still plans to impose tariffs on its neighbor next week.
In addition to today’s jobs report, Friday’s economic calendar also includes; Wholesale Inventories for April at 10am EST.
TODAY’S TOP HEADLINES
Politics & Economy: Fed Begins Debate on Whether to Cut Rate as Soon as June. (The WSJ)
Federal Reserve officials are beginning preparations for a June policy meeting with difficult choices to deliberate.
Mexico & Trade: US-Mexico Make Progress on Migration Issues, but Tariffs Still Loom. (The WSJ)
The Trump administration has made significant progress in its border-security negotiations with Mexico, a senior White House official said, but the US remained on track to impose tariffs on the country’s imports next week.
Today’s Economical Announcements.
08:30AM – ★★★ – Nonfarm Payrolls (May) (Previous: 263,000)
08:30AM – ★★★ – Unemployment Rate (May) (Previous: 3.6%)
10:00AM – ★☆☆ – Wholesale Inventories (Apr) (Previous: 0.7%)
STOCKS IN THE SPOTLIGHT
Pre-Market Movers & News Related Stocks.
Beyond Meat (BYND): [EARNINGS] Reported an adjusted loss of 14 cents per share in its first report as a public company, smaller than the 15 cents a share loss that Wall Street had been anticipating. The plant-based burger maker saw revenue come in above estimates, and the company said it expected its sales to more than double this year.
DocuSign (DOCU): [EARNINGS] Earned an adjusted 7 cents per share for its fiscal first quarter, 2 cents a share more than analysts had expected. The electronic signature technology provider’s revenue came in above estimates, but investors appear concerned about a slowdown in the rate of growth in billings.
Zoom Video (ZM): [EARNINGS] Earned an adjusted 3 cents per share for its first quarter, 2 cents a share above estimates. The video communications technology company’s revenue also beat forecasts and Zoom gave better-than-expected current-quarter revenue guidance.
Zumiez (ZUMZ): [EARNINGS] Reported first-quarter profit of 3 cents per share, compared to Wall Street forecasts of a 9 cents per share loss. The action sports apparel maker also reported better-than-expected revenue for the quarter, with particular strength in the final two months of the quarter.
Barnes & Noble (BKS): [NEWS] Agreed to be acquired by funds advised by Elliott Advisers for $6.50 per share in cash. It had been reported Thursday that a deal was close.
Guess (GES): [EARNINGS] Lost 25 cents per share for its first quarter, 1 cent a share more than Wall Street had been anticipating. The apparel maker’s revenue matched street forecasts, but Guess gave a full-year earnings forecast above current consensus.
Caesars Entertainment (CZR): [NEWS] Is near a deal to combine with rival casino operator Eldorado Resorts, according to people familiar with the matter who spoke to The Wall Street Journal.
Garmin (GRMN): [UPGRADE] Upgraded to “neutral” from “underweight” at J.P. Morgan Securities, which said the stock’s risk/reward profile is now more balanced following a 12% decline from its multiyear high in early April.
AT&T (T): [NEWS} Is mulling a plan to package its HBO and Cinemax movie channels and its Warner Brothers TV and movie library into a new streaming service, according to The Wall Street Journal.
IBM (IBM): [NEWS] Is planning to lay off about 1,700 workers, according to a person familiar with the matter who spoke to CNBC.
Norwegian Cruise Line (NCLH): [EARNINGS] Cut its full-year earnings per share outlook by 35 to 45 cents on an adjusted basis, due to the impact of new restrictions on cruise lines regarding travel to Cuba.
GAINERS: CIEN, SMAR, AMD, PLAN, CPB, TTD
Haymaker Acquisition (HYACU) (Price: 10) (Est. Vol: 350.0M)
Revolve Group (RVLV) (Price: 18) (Est. Vol: 200.0M)