US Market Today, July 2: Stock futures signal muted open; all eyes on June jobs report

The US equity market is expected to open on a flat-to-negative note on Thursday, July 2, as indicated by index futures. At 2:43 PM IST, Dow Futures traded flat at 52,670, while S&P 500 Futures were down 0.09% at 7,537.50 levels. The NASDAQ Futures traded 0.36% lower at 29,986 levels.

Wall Street ended lower on Wednesday, with technology stocks coming under pressure. The Dow Jones Industrial Average slipped 13.96 points, or 0.03%, to close at 52,305.24. The S&P 500 declined 16.13 points, or 0.22%, to 7,483.23, while the Nasdaq Composite dropped 173.69 points, or 0.66%, to settle at 26,040.03.

Technology shares led the decline in overnight trade, although gains in Meta Platforms helped limit losses in the S&P 500 and the Nasdaq.

Chipmakers were among the biggest laggards, with the Philadelphia Semiconductor Index tumbling 6.3%, making the technology sector the worst-performing segment on the S&P 500.

Investors remained cautious amid concerns over stretched valuations and the hefty AI-related spending by major technology companies.

What to watch

Investors will closely monitor the US June nonfarm payrolls report, scheduled for release at 8:30 a.m. ET on Thursday, for fresh clues on the health of the labour market and the Federal Reserve's policy path.

According to a CNBC report, citing a Dow Jones survey of economists, the US economy is expected to have added 115,000 jobs in June, while the unemployment rate is projected to remain unchanged at 4.3%.

Average hourly earnings are projected to have risen 3.5% year-on-year, indicating that wage growth continues to remain contained.

The jobs data is being released a day earlier than usual, as US equity and bond markets will remain closed on July 3 in observance of Independence Day.

Crude oil prices

Crude oil prices declined for a third straight session on Thursday as concerns over potential supply disruptions eased after Qatar said Iran and the United States had made progress in talks concerning the Strait of Hormuz.

In the afternoon trade, Brent crude futures were down 66 cents, or 0.92%, at $70.91 a barrel, while U.S. West Texas Intermediate (WTI) crude fell 59 cents, or 0.86%, to $67.99 a barrel. Both benchmarks were trading at their lowest levels since February 27.

According to a spokesperson for Qatar's Foreign Ministry, discussions between Iran and the US made "positive progress" on issues related to the memorandum that brought an end to the June conflict. However, there was no indication that the two sides had moved closer to reaching a broader, long-term peace agreement.

Asian markets

Asian markets tumbled on Thursday after a sharp selloff in US chipmakers reignited concerns that the AI-driven rally has outpaced underlying fundamentals.

South Korea's KOSPI led the losses, plunging more than 6% in early trade, while Japan's Nikkei 225 slipped over 2%. The broader MSCI Asia Pacific Index fell 0.9%, weighed down by a more than 5% decline in South Korean equities.

The weakness followed a 6.3% slump in a key semiconductor stocks index and losses across major Wall Street benchmarks overnight.

In early Asian trading, two-year U.S. Treasury yields steadied, while gold held on to gains from the previous session.

Investors also remained focused on comments from Federal Reserve Chairman Kevin Warsh, who said risks to inflation have eased in recent months while reaffirming the central bank's commitment to bringing inflation back to its 2% target, according to Bloomberg.