US pre-open: Modest gains expected ahead of all-important jobs report

(Sharecast News) - US stocks were expected to put in modest gains on Friday as markets awaited key labour-market data that could show job creation slowed to its lowest level this year. All three benchmark indices on Wall Street were rising 0.1-0.2% in pre-market trade.

It's been a busy few days for economic indicators, including jobless claims, ADP employment figures, personal consumption expenditures data and the job openings and labour turnover survey (JOLTS), which mostly pointed to a slight slowdown in economic activity over recent months.

Ahead of the release of non-farm payrolls data at 0830 ET, economists widely expect the Federal Reserve to hold interest rates steady at its next meeting in September, with only modest increases in inflation likely to deter them from tightening monetary policy again too soon. However, any upside surprise may prompt concerns that the Fed may raise rates further to cool an overheating economy.

"Weakening JOLTS job openings data alongside Wednesday's ADP payrolls decline brought confidence for equity bulls over a potentially underwhelming payrolls figure," said Joshua Mahony, analyst at Scope Markets. "However, yesterday's decline in unemployment claims does allay some speculation over any immediate crisis, bringing some risk-off sentiment as we head towards the release."

Non-farm payrolls are predicted to show a softening in job creation to 170,000 in August, from 187,000 the previous month. Meanwhile, the unemployment rate is expected to have remained stable at 3.5% last month.

The ISM purchasing managers' index is also due for release, at 1000 ET, and is expected to show that the decline in manufacturing activity eased slightly in August. The PMI, where a level below 50 indicates a contraction in activity, is predicted to improve to 47, from 46.4 the previous month.

In company news, tech giant Dell was a big mover in pre-market trade, with futures jumping 10% after delivering second-quarter adjusted earnings of $1.74 per share, well ahead of the $1.14 expected by analysts.

Workout gear group Lululemon was also in demand after impressing with its quarterly results.