* June nonfarm payrolls rise 213,000, tops estimates
* Unemployment rate, average hourly earnings also rise
* Futures: Dow dip 0.15 pct, S&P and Nasdaq flat
* Stock futures reverse course after jobs data, VIX drops
* Futures dipped earlier as U.S., China tariffs kicked in
* Trade-sensitive U.S. stocks little changed premarket (Adds details, comments; updates share prices)
By Sruthi Shankar and Savio D’Souza
July 6 (Reuters) - A stronger-than-expected U.S. job growth in June helped stock index futures on Friday pull back from slight declines that were triggered by United States and China slapping tit-for-tat duties on $34 billion worth of each other’s imports.
Nonfarm payrolls increased by 213,000 jobs last month, the Labor Department said, topping expectations of 195,000, while the unemployment rate rose from an 18-year low to 4.0 percent and average hourly earnings rose 0.2 percent.
The moderate wage growth should allay fears of a strong build-up in inflation pressures that should keep the Federal Reserve on a path of gradual interest rate increases.
“It was what the market wanted to see: more jobs created than expected, wage growth moderate and creating jobs where you want to see them ... It’s not just creating jobs it’s creating careers,” said J.J. Kinahan, chief market strategist at TD Ameritrade in Chicago.
The strong jobs data follows the minutes of the Federal Reserve’s latest policy meeting which showed policymakers discussed if recession lurked around the corner and expressed concerns trade tensions could hit an economy that by most measures looked strong.
Earlier stock futures were set for a more cautious start after the United States and China imposed tariffs on each other, with Beijing accusing Washington of starting the “largest-scale trade war.”
President Donald Trump warned the United States may ultimately target over $500 billion worth of Chinese goods, but global markets remained broadly sanguine, though concerns about the conflict escalating capped appetite for risk.
“The expectation of things is always worse for the market than the reality,” said Kinahan. “We certainly have to pay attention to trade but it’s been expected for a long time.”
At 8:59 a.m. EDT, Dow e-minis were down 36 points, or 0.15 percent. S&P 500 e-minis were down 0.5 points, or 0.02 percent and Nasdaq 100 e-minis were up 3.5 points, or 0.05 percent.
The U.S. market’s main measure of short-term volatility, the CBOE Volatility index, were down 0.08 points, after being a couple of point higher ahead of the jobs data.
Twenty-eight of the 30 components of the blue-chip Dow Jones Industrial Average were trading premarket, with an even spread of gainers and losers, although trading volumes were thin.
Among them, Boeing, the single largest U.S. exporter to China, and Caterpillar slipped about 0.08 percent.
The advancers and decliners in chipmakers, which rely on China for a substantial chunk of revenue, were also evenly spread, ranging between a drop of 1.1 percent and a gain of 0.8 percent.
Large cap Chinese companies listed on U.S. bourses dipped slightly, with Alibaba and Baidu little changed.
Among other stocks, Biogen jumped 13.2 percent after Japanese drugmaker Eisai Co and the company said the final analysis of a mid-stage trial of their Alzheimer’s drug showed positive results. (Reporting by Sruthi Shankar and Savio D’Souza in Bengaluru; Editing by Arun Koyyur)