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Dow Futures Pointing to Sharp Decline Ahead – Focus on Macro Data -

Feb, 02nd 15:08

Dow  futures pointed to a steep decline on Friday ahead of the unemployment report and non-farm payrolls.

Dow futures tumbled 264 points, or 1.01%, S&P 500 futures fell 20 points, or 0.70%, while the Nasdaq 100 futures traded down 25 points, or 0.36%.

The increase in bond yields comes under growing expectations for economic activity. On Thursday, the Atlanta Federal Reserve predicted that the U.S. economy would see a 5.4% expansion in the first quarter of this year.

The U.S. Labor Department’s January non-farm payrolls report will be released at 8:30AM ET (13:30GMT).

The consensus forecast is that the data will show jobs growth of 184,000, after rising by 148,000 in December. The unemployment rate is forecast to hold steady at 4.1%. Most of the focus will likely be, on average hourly earnings figures, which are expected to rise 0.3% after gaining 0.3% a month earlier.

In earnings releases slated for Friday, Merck (NYSE:MRK), Exxon (NYSE:XOM) and Chevron (NYSE:CVX) will all report before the opening bell.

On the technical charts, Dow30 is trading in the red zone below the 9 day and the 20 day moving averages, but above the 50 day, 100 day and the 200 day moving averages. The RSI is placed at 56.03 and the MACD is below the signal line. The market is struggling near the 61.8% Fibonacci retracement level (from 24754 and 26673).

Trade suggestion:

Buy digital Put options between 26000 and 25850, valid until 23:00 GMT February 2nd 2018