Wall St futures slip as investors brace for key jobs report

Dec 16 (Reuters) – U.S. stock index futures slipped on Tuesday as caution set in ahead of a highly anticipated jobs report that could offer insight into the health of the economy and the potential path for interest rates next year.

A recent historic ‍government shutdown left investors and the Federal Reserve starved of official data and increasingly reliant on secondary indicators that offered a mixed picture on the health of the labor market.

However, policymakers broadly acknowledged that the jobs market was weakening when the central bank lowered interest rates last week.

The Labor Department is scheduled to release its reports at 8:30 a.m. ET and economists expect job growth to have rebounded in November following an ‌anticipated decline in nonfarm payrolls in October, still consistent with a gradually ‌weakening labor market.

Also on tap are delayed retail sales figures for the month of October, along with an initial estimate on business activity for the current month by S&P Global.

“The FOMC (the Federal Open Market Committee) is now very much in ‘data-dependent’ mode, with the reaction function continuing to tilt almost entirely towards supporting a ​stalling U.S. labor market,” said Michael Brown, senior research strategist at Pepperstone.

“Hence, any softness should spark a modest dovish repricing of policy expectations.”

Investors are pricing in at least 50 basis points ‍of interest rate cuts next year, according to CME’s FedWatch ​Tool.

At 5:47 a.m. ET, Dow e-minis were down 61 points, or 0.13%, ​U.S. S&P 500 E-minis were down 13 points, or 0.19%, and Nasdaq 100 E-minis were down 79 points, ‍or 0.31%.

Wall Street’s main indexes closed lower in the previous session, with the tech-heavy Nasdaq hitting a three-week low as rate cut uncertainty and tech valuation worries spooked investors, while they weighed reports on developments around selecting a nominee to the Fed chair role.

Traders also rotated into other areas of the market such as healthcare and banks that have outperformed the benchmark S&P 500 ‍on a quarterly basis.

The Russell 2000 index, tracking rate-sensitive small caps, along with the blue-chip Dow have also witnessed notable gains over the past three months.

Among others, B. Riley jumped 24% in premarket trading ‍after the investment bank reported ‍a profit for the second quarter, compared with a year-ago loss in ​an overdue quarterly filing.

Ford Motor said it will take a $19.5 billion writedown ​and is ⁠killing several electric-vehicle models, in the most dramatic example yet of ‌the auto industry’s retreat from battery-powered models. Shares of the legacy automaker were flat.

IRobot lost 23%, looking set to extend Monday’s 67% slump after the Roomba vacuum-cleaner maker filed for bankruptcy.

Meanwhile, a Reuters report said Nasdaq submitted paperwork with the U.S. Securities and Exchange Commission to roll out round-the-clock trading of stocks, months after the New York Stock Exchange and Cboe Global Markets announced similar plans.

(Reporting by Johann M Cherian in Bengaluru; ⁠Editing by Maju Samuel)