Market Jitters: Stock Futures Decline Ahead of Key Jobs Data

U.S. stock index futures dropped on Friday before crucial jobs data, influencing the Federal Reserve's interest rate decision. The August nonfarm payrolls report may indicate a rise to 160,000 jobs. This data comes amid scrutiny of the labor market and shaky investor confidence. Mixed economic signals have led to significant stock market movements.

U.S. stock index futures declined on Friday ahead of the release of key jobs data that could heavily influence the Federal Reserve's upcoming interest rate decision.

The August nonfarm payrolls figure, due at 8:30 a.m. ET, is expected to show a rise to 160,000 from July's 114,000. Forecasts also suggest the unemployment rate may drop to 4.2% from 4.3% in July. 'The key question of course is how the Fed will react after today's labor market data,' said Teeuwe Mevissen, senior macro strategist at Rabobank.

The labor market has been closely watched after a surprise rise in unemployment triggered recession fears, causing major indexes to fall, with the Nasdaq entering correction territory. Traders currently expect a 57% chance of a 25-basis point interest rate cut, and a 43% chance of a 50-basis point cut, according to CME Group's FedWatch Tool.

Dow E-minis declined 161 points, S&P 500 E-minis dropped 38.5 points, and Nasdaq 100 E-minis fell 233.5 points in early trading. September has historically been a weak month for U.S. equities, with the S&P 500 averaging a 1.2% decline since 1928.

This week, the S&P 500 is on track for a 2% drop, its largest in nearly five months, led by a 5% fall in technology stocks. Broadcom slid 9.6% after a forecast miss, while Nvidia and Marvell Technology both fell 2.2%, and Advanced Micro Devices dropped by 1.2%. The Philadelphia SE Semiconductor index is set for its largest weekly drop in over a month.

Other market movers included Mobileye Global, which fell 4.9% following Intel's potential stake sale, and U.S. Steel, rising 3% amid acquisition discussions with Japan's Nippon Steel. Samsara saw a 5.2% increase after revising its annual revenue forecast upwards.

(With inputs from agencies.)