U.S. stock futures fall ahead of jobs report

[December 02, 2016]  By Yashaswini Swamynathan

(Reuters) - U.S. stock index futures fell on Friday on expectations of a strong jobs report, which would confirm an interest rate hike in the coming weeks.

A report from the U.S. Labor Department is expected to show that 175,000 jobs were added in the public and private sectors in November, compared with 161,000 added the previous month. The data, due at 8:30 a.m. ET (1330 GMT), is also likely to show that unemployment rate remained steady at 4.9 percent last month.

Strength in the labor market and improving inflation are two factors that influence the Federal Reserve's decision on raising interest rates. The central banks' policy-setting committee meets on Dec. 13-14.

The Fed has been preparing the markets for a rate hike in the backdrop of strong economic data, including gains in consumer spending, inflation and manufacturing.

President-elect Donald Trump's promise of fiscal stimulus may contribute to a rise in inflation, bolstering the prospects for higher rates.

Traders have currently priced in a 92.4 percent chance of a hike this month, according to Thomson Reuters data.

The Dow ended with a record close on Thursday, riding on gains in banks and oil stocks.

However, the S&P 500 recorded two straight days of losses for the first time since the vote, pointing to a fizzling post-election rally.


Fed Board Governor Lael Brainard is scheduled to speak at an event in Washington at 8:45 a.m. ET. Fellow board Governor Daniel Tarullo and Cleveland Fed President Loretta Mester will speak at separate events.

Traders work on the floor of the New York Stock Exchange (NYSE) in New York City, U.S., November 29, 2016. REUTERS/Brendan McDermid

Oil prices fell 1.5 percent, pausing a two-day rally that had sent prices to a more than 16-month high.

Starbucks  fell 3.13 percent to $56.68 in premarket trading after the coffee chain operator said Howard Schultz would step down as chief executive officer.

Ulta Salon rose 6.24 percent to $273.46 after the company reported quarterly revenue above analysts' expectations.

(Reporting by Yashaswini Swamynathan in Bengaluru; Editing by Anil D'Silva)

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