U.S. stock index futures were set for a positive end to the week (ES00: +0.53%) after economic data showed an unexpected decline in jobs last month, raising doubts about a Federal Reserve interest-rate hike in September.
According to a Labor Department report, July nonfarm payrolls fell by 23,000, far below the forecast increase of 80,000 jobs.
Treasury yields fell as the employment data stoked concerns about the state of the economy, leaving investors with less reason to fear a rate hike. Money markets now price the probability of a 25 bp hike in September at 39%, versus 56% previously, according to LSEG.
The U.S. dollar weakened against major global currencies, as this development shifts the interest-rate differential in favor of the euro, with markets pricing the probability of another European Central Bank rate hike in September at 75%. The euro rose 0.42% to $1.157.
Oil prices are fluctuating as investors try to assess the situation in the Middle East. Reports say Iran is considering banning U.S. and Israeli ships from passing through the Strait of Hormuz. The September WTI crude futures contract stands at $76.66 a barrel (-0.82%).
Gold prices are on track for their biggest weekly gain since January. The December gold futures contract reached $4422 an ounce (+2.85%).