US stock futures hover mostly above the flatline on Thursday, ahead of a raft of new labor market figures due out this week that may play into an upcoming Federal Reserve interest rate decision. Elsewhere, US President Joe Biden is reportedly set to block Nippon Steel's takeover of US Steel (NYSE:X), while the Wall Street Journal reports that Verizon is in advanced talks to acquire Frontier Communications.
1. Futures steady
US stock futures steadied on Thursday, as investors geared up for fresh labor market data that could influence the Federal Reserve's next monetary policy decision.
By 03:31 ET (07:31 GMT), the Dow futures contract had added 22 points or 0.1%, S&P 500 futures had moved up by 5 points or 0.1%, and Nasdaq 100 futures were mostly unchanged.
The benchmark S&P 500 and tech-heavy Nasdaq Composite both finished in the red to end a session of choppy trading on Wednesday. The 30-stock Dow Jones Industrial Average ended higher.
Underpinning sentiment was data showing the number of job openings in the US dropped to a 3-1/2 year low in July, in the latest signal of a gradual slowdown in American labor demand. Meanwhile, Atlanta Fed President Raphael Bostic warned that the employment picture could see "disruptions" if interest rates remain too high for much longer.
The figures and Bostic's comments further bolstered expectations that the Fed will move to slash rates at the central bank's gathering later this month.
In individual stocks, Nvidia (NASDAQ:NVDA) shares, which had already suffered a steep decline earlier in the week, fell by 1.7%. Before the end of the trading day, the artificial intelligence-darling denied a report that it had received a subpoena from the US Department of Justice as part of a probe into potential antitrust practices.
2. Private payrolls, jobless claims ahead
Investors will receive a further look into the US employment market on Thursday, while the all-important August jobs report is due out later in the week.
Both the ADP National Employment Report, a measure of private payrolls, and weekly first-time jobless claims numbers are set to be published.
The previous ADP data showed that private payrolls rose by far less than anticipated in July. Meanwhile, the number of Americans filing for initial unemployment insurance in week ending on August 24 was in line with forecasts of 231,000.
Although the returns will likely be closely monitored by markets, the key release of the week will be Friday's more comprehensive nonfarm payrolls report from the Labor Department's Bureau of Labor Statistics.
Economists are predicting that the US economy added 164,000 jobs last month, an increase from 114,000 in the prior month. The July total, which was far below expectations, sparked a broader market downturn as traders fretted over the possibility of a US recession.
3. Biden set to block Nippon Steel-US Steel deal - reports
US President Joe Biden is set to block the proposed $14.9 billion takeover of US Steel by Japan's Nippon Steel due to national security concerns, according to several media outlets.
Citing sources familiar with the matter, the reports said Biden's decision will be announced in the coming days. A government panel responsible for overseeing foreign investment has informed Nippon Steel that the national security worries could not be overcome, the Financial Times added.
Biden, as well as vice president and current Democratic presidential candidate Kamala Harris, have previously voiced their opposition to the deal. Donald Trump, Harris's Republican rival for the White House, has also come out against the takeover.
US Steel has said that failing to close the deal could put thousands of US union jobs at risk and may force it to shutter some steel mills. Shares in US Steel slumped by more than 17% on Wednesday.
4. Verizon in talks to acquire Frontier Communications (OTC:FTRCQ) - WSJ
Verizon (NYSE:VZ) is in advanced talks to purchase Frontier Communications (NASDAQ:FYBR), marking a deal that would help boost the firm's fiber network, the Wall Street Journal has reported.
An announcement of the acquisition may come as soon as this week, the WSJ said, citing people familiar with the matter.
The report did not specify the value of the agreement. Frontier Communications, which provides broadband connection services in 25 US states and emerged from bankruptcy in 2021, had a market value of $7 billion as of Tuesday's close.
Its shares gained roughly 38% on Wednesday following the WSJ's report, while Verizon's stock price dipped by more than 3%.
5. Crude inches higher
Crude prices edged higher Thursday, after plunging to multi-month lows, on reports that major producers may delay an output increase as well as falling US inventories.
By 03:30 ET, the Brent contract gained 0.6% to $73.15 per barrel, after falling in the previous session to the lowest close since June 27, 2023, while U.S. crude futures (WTI) traded 0.6% higher at $69.61 a barrel, after dropping on Wednesday to the lowest settlement since Dec. 11.
Data found support after American Petroleum Institute data showed U.S. crude oil fell by 7.431 million barrels last week, more than the 1 million barrel draw expected.
The Organization of the Petroleum Exporting Countries and allies led by Russia, known as OPEC+, is discussing delaying its oil output increase scheduled to start in October, Reuters reported on Wednesday, citing sources.
