In other news, Samsung Electronics has said that the rising demand for artificial intelligence would cause its profits to climb fifteen times in the next quarter.
Higher futures
As investors anticipated the publication of a significant monthly labor market data, U.S. stock futures moved higher on Friday (more below). The Dow futures contract had gained 57 points, or 0.2%, at 03:27 ET (07:27 GMT), the S&P 500 futures had gained 7 points, or 0.1%, and the Nasdaq 100 futures had gained 41 points, or 0.2%. On Thursday, the primary averages on Wall Street were closed in observance of Independence Day.
Upcoming nonfarm payrolls
It is anticipated that U.S. firms created fewer jobs in June, which may indicate a slowing demand for labor and support the argument that the Federal Reserve will start lowering interest rates later this year from more than two-decade highs.
According to economists, nonfarm payrolls decreased from 272,000 in May to 191,000 last month. In the meanwhile, it is predicted that the average hourly pay will increase at a somewhat slower rate of 0.3% every month going forward, and the unemployment rate will likely approach May’s 4.0% pace.
Data released earlier this week revealed that the rise in private payrolls slowed down last month and that the quits rate, which is a measure of labor market confidence, remained stable, indicating that pressure from wages may be lessening.
Less upward pressure on inflation as a result of the labor market’s slowdown might bolster expectations that the Fed would lower interest rates in 2024. This year, the central bank has said that it would only lower borrowing prices once, as decision-makers seek more proof that price increases are gradually slowing down.
Samsung Electronics anticipates record profits for the second quarter.
Expecting exponential growth in its second-quarter earnings, Samsung Electronics (KS:005930) is a technological corporation further bolstered by artificial intelligence-driven demand for electronic products and memory chips.
The largest memory chip manufacturer in the world said on Friday that, compared to a profit of 670 billion won during the same time last year, its operational profit for the three months ending on June 30 likely increased to 10.4 trillion won ($7.50 billion).
The amount was much higher than estimates for revenue of 8.8 trillion won, according to LSEG SmartEstimate projections reported by Reuters. It was the largest since the third quarter of 2022.
The AI industry’s growing demand for memory chips, especially high-bandwith memory chips, was the driving force behind Samsung’s better-than-expected profitability. Samsung said that it would start mass manufacturing cutting-edge HBM chips this year in an attempt to secure further orders from Nvidia, the AI industry leader (NASDAQ:NVDA).
Labour landslide; impending French vote
Investors’ attention will be focused on the evolving political landscape in the United Kingdom on Friday, after the opposition Labour Party’s overwhelming victory in a parliamentary election that ended 14 years of sometimes tumultuous Conservative rule.
With a few seats still to declare, Labour, headed by Keir Starmer, has secured 410 of the 650 seats in parliament as of 03:16 ET, giving them a sizable majority.
As traders seem to have concluded that a period of extreme market volatility, caused by political and economic turmoil under the Conservatives, may be coming to an end, U.K. equities have increased along with the value of the pound.
Nevertheless, the election also saw the rise of the right-wing populist Reform UK party, led by Nigel Farage, a prominent Brexit proponent.
This puts the French parliamentary election’s second round of voting, which is scheduled for Sunday, in sharp relief given the far-right National Rally’s victory in the first round of voting last weekend
