A trader works on the floor of the New York Stock Exchange.
US stock futures traded slightly higher early Tuesday morning after the Dow slid from a record high on the Friday leading up to the three-day Labor Day weekend.
Dow Jones Industrial Average futures rose 28 points. The futures on S&P 500 and Nasdaq 100 traded in slightly positive territory.
In Friday’s regular trading session, the Dow lost 74.73 points, or 0.21%, while the S&P 500 was down a modest 0.03%. Tech-heavy Nasdaq rose 0.21%, helping the broader market.
The losses came after the August job report fell below expectations, underscoring ongoing concerns over the spread of Covid and its Delta variant. The number of non-farm employees rose 235,000 in August, the Department of Labor reported, but economists polled by Dow Jones estimated 720,000 jobs.
Ryan Detrick, chief market strategist at LPL Financial, said there could be a strong recovery in jobs “in the coming months” and there are promising signs that the worst spike in Covid cases may be behind us. However, August’s job report has the potential to delay the Fed’s schedule, which is expected to begin later this year, Detrick said.
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“Fed Chairman Powell has made it clear that the labor market will serve as his indication of when to start reducing asset purchases,” he said. “With [Friday’s] It is clear that the labor market is under pressure in the short term, and while that pressure is likely to ease, the Fed will likely be cautious to avoid premature action.
For one week in September, the key averages all rose despite a subdued start for the month. Year to date, the Dow is up 15.5%, the S&P is up 20.7% and the Nasdaq Composite is up 19.2%, although investors and analysts are still looking for a major correction in September.
“Granted, passive investors have felt no pain just yet,” Bank of America said in a note on Friday, adding that “2021 will be another year in which the [S&P 500] has smashed it, but some signs suggest it may be time to get “pickier” about stocks. “
No economic data will be released on Tuesday. Later that week, Mary Daly, president of the Federal Reserve Bank of San Francisco, speaks at a Brookings Institute conference.