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Eyes will now be on the monthly jobs report, due at 8:30 a.m.
ET, for clues on the path of interest rate hikes amid growing
concerns of a possible recession.
Tesla Inc's shares fell 4% in premarket trading after Musk said
he has a "super bad feeling" about the economy and wants to cut
about 10% of jobs at the electric-car maker, in an email to
company executives seen by Reuters.
Nasdaq 100 futures turned lower following the report and were
last down 0.9%.
"Musk has a tendency to say exactly what he thinks and believes,
and he does have a fair point," said Fiona Cincotta, senior
financial markets analyst at City Index.
"Although the Fed thinks a soft landing is possible, I do think
there are some warning signs in the economy. The question is
will they be able to act as aggressively as they need to ...
Musk doesn't think that they're going to be able to without
putting the economy into a deep recession."
JPMorgan Chase Chief Executive Jamie Dimon earlier this week
described the challenges facing the U.S. economy akin to a
"hurricane".
The Labor Department's closely watched report will likely show
U.S. employment increased at a brisk clip in May, wages grew
strongly and jobless rate dropped to its pre-pandemic low of
3.5%, all of which are signs of a tight labor market.
Economists polled by Reuters expect nonfarm payrolls to rise by
325,000 jobs last month after rising 428,000 in April.
Volatility has gripped Wall Street recently as hawkish comments
from Federal Reserve officials kept investors on edge, even as
recent set of economic data showed signs that inflation may have
peaked and U.S. consumer strength was resilient.
The blue-chip Dow has fallen 8.5% so far this year, the
benchmark S&P 500 12.4%, and the tech-heavy Nasdaq 21.3%, with
rate-sensitive growth stocks bearing the brunt of the sell-off.
At 07:04 a.m. ET, Dow e-minis were down 111 points, or 0.33%,
S&P 500 e-minis were down 21.75 points, or 0.52%, and Nasdaq 100
e-minis were down 116.5 points, or 0.9%.
Lululemon Athletica rose 1.4% after the company raised its
full-year forecast on strong demand for athleisure products and
said the impact from COVID-19 lockdowns in China was modest.
Kohl's Corp gained 7.8% after a media report that the department
store received takeover bids from private equity firm Sycamore
Partners and retail holding company Franchise Group Inc.
(Reporting by Sruthi Shankar, Medha Singh, Devik Jain and Anisha
Sircar in Bengaluru; Editing by Shounak Dasgupta)
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