Investing.com - Here are the top five things you need to know in financial markets on Friday, Feb. 1:
1. Employment report, manufacturing survey on tap
The U.S. jobs report for January will capture markets’ attention on Friday at 8:30 AM ET (13:30 GMT), although the impact may be dampened by the Federal Reserve’s decision this week to hold monetary policy steady and be “patient” before embarking on further tightening.
On average, economists expect that nonfarm payrolls rose by 165,000 for the month and that the unemployment rate held steady at 3.9%.
However, most of the attention will likely focus on wage inflation with the average hourly earnings expected to post a monthly gain of 0.3%, dipping slightly from the prior month. Even so, the annualized rise is forecast to hold steady at 3.2%.
At 10:00 AM ET (15:00 GMT), the Institute of Supply Management will release its manufacturing purchasing manager’s index (PMI) for January. Economists forecast a slight tick down to 54.2.
At the same time, the University of Michigan will issue its final measure of January consumer sentiment which is expected to inch up to 90.8.
2. Global stocks cautious after record performance in January
Global stocks took a breather on Friday as weak data from China dampened bullish sentiment after equities closed their best January performance on record in the prior session.
U.S. futures pointed to a relatively muted open although pressure was seen in technology after a worrying outlook from Amazon. At 5:53 AM ET (10:53 GMT), the blue-chip Dow futures gained 30 points, or 0.11%, S&P 500 futures slipped 1 point, or 0.05%, while the Nasdaq 100 futures traded down 31 points, or 0.44%.
Elsewhere, European bourses went sideways as weak economic data offset hopes for an end to the U.S.-China trade war. The pan-European Stoxx 600 inched up 0.1%.
Earlier, Asian stocks saw mixed trade across the region as weak data on Chinese factory activity raised worries over the global economic slowdown. Some analysts however pointed to U.S. President Donald Trump’s comments that he would soon meet with Chinese President Xi Jinping to try and reach a deal on trade as a positive. Chinese financial markets will be closed next week to celebrate the Lunar New Year.
3. Amazon’s sales outlook hits tech
Amid the lackluster trade in U.S. futures, technology led losses after Amazon reported quarterly earnings.
Although both revenue and profit topped forecasts, its revenue guidance fell short of estimates again, its net income guidance looked cautious and its subscription services revenue growth was much lower than recent quarters.
Shares in Amazon (NASDAQ:AMZN) sank 4% in premarket trade.
4. Dow components in the earnings spotlight
Dow components Exxon Mobil (NYSE:XOM), Chevron (NYSE:CVX) and Merck (NYSE:MRK) will all be in the earnings spotlight on Friday as the blue-chip companies release earnings before the opening bell.
Outside the Dow, Honeywell (NYSE:HON), Madison Square (NYSE:SQ) Garden (NYSE:MSG) and Cigna (NYSE:CI) will also be among the string of reports on the radar.
As of Thursday’s close, 210 of the S&P 500 companies have already released results corresponding to the fourth quarter. 70% have beaten expectations for profits and 64% topped sales forecasts, but analysts from The Earnings Scout warn that growth is slowing.
Read more: GM Earnings Won’t Offer Much To Get Revved Up About - Haris Anwar
5. China factory activity nears 2-year low
China’s Caixin manufacturing PMI contracted more than expected in January, dropping to a 23-month low.
The Caixin/Markit index of manufacturing for January came in at 48.3 from 49.7 last month. The reading was at its lowest since February 2016 and missed consensus estimates that had expected a smaller drop to 49.5.
The slowdown in the world’s second largest economy exacerbates concerns over the global economic outlook, although Trump gave an upbeat outlook on trade negotiations.
Trump said the talks between China and the U.S. had made “tremendous progress,” while Chinese state-owned media Xinhua reported that Beijing agreed to increase imports of “U.S. agricultural products, energy products, industrial manufactured goods and service products."
-- Reuters contributed to this report.