US futures point higher ahead of this week’s labor data

US futures point higher ahead of this week's labor data

Wall Street pointed modestly higher Tuesday ahead of the first of three government employment reports this week which could draw a sharper outline of the U.S. employment situation ahead of the Federal Reserve’s next meeting.

Futures for the benchmark S&P 500 rose about 0.3%, while the Dow industrials inched up less than 0.2%.

On Tuesday, the U.S. reports on the number of job openings in February. That’s followed by the weekly unemployment report on Thursday and the March jobs report on Friday.

A strong job market, on top of four-decade high inflation, has pushed policymakers at the Federal Reserve to raise the central bank’s main borrowing rate nine consecutive times since last March. In its latest quarterly economic projections, the policymakers forecast that they expect to raise their key rate just once more — from its new level of about 4.9% to 5.1%, the same peak they had projected in December.

At its policy meeting last month, the Fed raised its key interest rate by a quarter-point despite concerns that higher borrowing rates could worsen the turmoil that has gripped the banking system in recent weeks.

On the international front, the Paris-based Organization for Economic Cooperation and Development reported inflation in leading economies fell to 8.8% in February from 9.2% in January. Inflation rates remained above 20% in Hungary, Latvia and Turkey, but overall, inflation fell in 23 of the 38 OECD economies.

Easing energy prices were a major factor, though oil prices have surged after producing countries announced Sunday they will cut output from May 1 through the end of the year. That could potentially slow broader efforts to tame inflation.

In Europe at midday, Germany’s DAX gained 0.9% and the CAC 40 in Paris was 0.6% higher while Britain’s FTSE 100 was essentially flat.

The S&P/ASX 200 in Sydney edged 0.2% higher to 7,236.00 after Australia’s central bank kept its key interest rate unchanged at 3.60%

“The Board took the decision to hold interest rates steady this month to provide additional time to assess the impact of the increase in interest rates to date and the economic outlook,” the Reserve Bank of Australia said in a statement, citing the usual lag between interest rate changes and their impacts.

While Australia’s economy is much smaller than that of the U.S. or European Union, its central bank and that of New Zealand tend to “set the tone for monetary policy cycles,” Ipek Ozkardeskaya of said in a commentary.

South Korea reported its consumer inflation rate fell to a lower-than-expected 4.2% in March from a year earlier from 4.8% the month before. That has raised expectations that the central bank will keep its key interest rate at 3.5% when it meets next week.

Regional central banks have been varying their strategies as inflation wanes in some places but remains stubbornly high in others. Vietnam’s central bank eased its benchmark rate on Monday to reflect a slowdown in the economy. Japan has kept its key interest rate at minus 0.1% and China has been easing credit to alleviate pressures on its vital property sector.

The Reserve Bank of New Zealand was due to make a decision on interest rates on Wednesday.

Elsewhere in Asia, Tokyo’s Nikkei 225 gained 0.4% to 28,287.42, while the Shanghai Composite index picked up 0.5% to 3,312.56. Hong Kong’s Hang Seng lost 0.7% to 20,274.59.

Shares fell in Bangkok. Markets were closed in India and Taiwan.

A barrel of U.S. crude oil was 68 cents higher at $81.10 per barrel in electronic trading on the New York Mercantile Exchange. It jumped $4.75 to settle at $80.42 on Monday after Saudi Arabia and other producers said they’ll cut production by 1.15 million barrels per day from May until the year’s end. Less oil pumped means higher prices, as long as demand stays steady.

Brent crude, the international standard, rose 67 cents to $85.60 in London. It gained $5.04 to $84.93 per barrel on Monday and is roughly back to where it was a month ago.

In other trading Tuesday, the U.S. dollar rose to 132.97 Japanese yen from 132.44 yen late Monday. The euro ticked down to $1.0904 from $1.0905.

Shares in Virgin Orbit tumbled another 22% to 15 cents a share on Tuesday after the Richard Branson company filed for Chapter 11 bankruptcy protection. A failed mission this year and increasing difficulty in raising funding for future missions forced the company to lay off most of its staff last week.

On Monday, big gains for energy stocks helped offset losses for some big technology stocks on Wall Street. The S&P 500 rose 0.4% and the Dow Jones Industrial Average gained 1%. The Nasdaq composite lost 0.3%.

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