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US STOCKS-Futures jump ahead of payroll report
July 5, 2013 / 11:22 AM / in 4 years

US STOCKS-Futures jump ahead of payroll report

* Payroll report not seen adjusting Fed stimulus timeline

* Markets may be volatile with light post-holiday volume

* Investors watching situation in Egypt for oil impact

* Futures up: Dow 144 pts, S&P 13.7 pts, Nasdaq 27.25 pts

By Ryan Vlastelica

NEW YORK, July 5 (Reuters) - U.S. stock index futures jumped on Friday as investors looked ahead to the monthly payrolls report, which is expected to show solid jobs growth while not being strong enough to influence Federal Reserve policy.

* The central bank’s bond-buying stimulus program has been widely credited with both the steep stock market gains thus far in 2013, as well as recent volatility as market participants question the timeline for the program ending.

* Fed Chairman Ben Bernanke has said the program would be slowed if the economy improves as the Fed expects, making economic data a major market driver. However, markets have sold off on bullish data on the theory that this means the stimulus will be ended sooner.

* The Labor Department’s non-farm payrolls report at 8:30 a.m. (1230 GMT) is expected to show about 165,000 jobs were added in June, below the 175,000 added last month. The unemployment rate is seen moving to 7.5 percent from 7.6 percent.

* Cyclical shares, which are tied to the pace of economic growth, are likely to show the biggest reaction to the data. Bank of America edged higher in light premarket trading.

* S&P 500 futures rose 13.7 points and were above fair value, a formula that evaluates pricing by taking into account interest rates, dividends and time to expiration on the contract. Dow Jones industrial average futures added 144 points and Nasdaq 100 futures rose 27.25 points.

* Trading volume could be light with many traders away from the office. Markets were closed on Thursday for the Fourth of July holiday after an abbreviated session on Wednesday. The low participation could lead to more volatile markets.

* On Wednesday, weekly jobless claims and the ADP employment report were both stronger than expected, a positive sign ahead of the jobs report. Markets ended slightly higher in a volatile session.

* The S&P 500 is down 3.2 percent from its May 21 record closing high of 1,669.16. The benchmark index has been unable to close above its 50-day moving average since June 20, a level which is now at 1,624.68.

* U.S. crude futures rose 0.1 percent, hovering at 14-month highs. While the jobs report could give a clue into the demand prospects for oil going forward, investors are also watching the continued unrest in Egypt, which could cause a further spike in prices on supply concerns.

* The U.S. Securities and Exchange Commission has filed a lawsuit accusing unnamed defendants of insider trading in Onyx Pharmaceuticals Inc call options before the drugmaker publicly rejected a takeover bid by larger rival Amgen Inc and put itself up for sale.

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