U.S. Stocks May See Further Upside Following Weaker Than Expected Jobs Data

After moving sharply higher over the past several sessions, stocks are likely to see further upside in early trading on Friday. The major index futures are currently pointing to a higher open for the markets, with the S&P 500 futures up by 0.4 percent.

The futures advanced following the release of a Labor Department report showing U.S. employment rose by less than expected in the month of October.

The closely watched report said employment climbed by 150,000 jobs in October after jumping by a downwardly revised 297,000 jobs in September.

Economists had expected employment to increase by 180,000 jobs compared to the surge of 336,000 jobs originally reported for the previous month.

The Labor Department also said the unemployment rate crept up to 3.9 percent in October from 3.8 percent in September. The unemployment rate was expected to remain unchanged.

The data is likely to add to optimism the Federal Reserve is done raising interest rates after the central bank left rates unchanged for the third time in four meetings earlier this week.

Treasury yields are extending a recent slump following the release of the report, potentially adding to the buying interest on Wall Street.

Shortly after the start of trading, the Institute for Supply Management is scheduled to release its report on service sector activity in the month of October.

The ISM’s services PMI is expected to edge down to 53.0 in October from 53.6 in September, although above 50 would still indicate growth.

Extending the strong upward move seen over the past several sessions, stocks moved sharply higher during trading on Thursday. The major averages all showed significant moves to the upside, climbing further off last week’s multi-month lows.

The major averages saw continued strength going into the close, ending the session near their best levels of the day. The Dow jumped 564.50 points or 1.7 percent to 33,839.08, the Nasdaq surged 232.72 points or 1.8 percent to 13,294.19 and the S&P 500 spiked 79.92 points or 1.9 percent to 4,317.78.

In overseas trading, stock markets across the Asia-Pacific region moved notably higher on Friday, with the Japanese markets closed for a holiday. Hong Kong’s Hang Seng Index soared by 2.5 percent, while South Korea’s Kospi jumped by 1.1 percent.

The major European markets also moved to the upside on the day. While the U.K.’s FTSE 100 Index is nearly unchanged, the French CAC 40 Index is up by 0.2 percent and the German DAX Index is up by 0.4 percent.

In commodities trading, crude oil futures are jumping $0.98 to $83.44 a barrel after surging $2.02 to $82.46 a barrel on Thursday. Meanwhile, after edging up $6 to $1,993.50 an ounce in the previous session, gold futures are rising $14 to $2,007.50 an ounce.

On the currency front, the U.S. dollar is trading at 149.50 yen versus the 150.45 yen it fetched at the close of New York trading on Thursday. Against the euro, the dollar is valued at $1.0701 compared to yesterday’s $1.0622.

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