Nasdaq to lead gains as markets eye tariff judgement, jobs report

• December non-farm payrolls report expected to show 50,000 job gains with unemployment dipping to 4.5%, though Deutsche Bank warns the data may be 'more random than normal' due to five years of revisions being processed simultaneously
• A Supreme Court decision on Trump's tariff policies could boost markets if struck down, but may also hit government revenue and potentially increase Treasury yields with broader financial market implications
• Defense stocks drove the Dow 0.6% higher Thursday on proposed spending increases, while tech losses in Nvidia, Apple and Meta dragged the Nasdaq lower

Market Summary: US Futures Mixed Ahead of Jobs Report and Tariff Ruling

Market Overview:

US stock futures showed mixed performance Friday morning, with Nasdaq futures up 0.2%, S&P 500 futures gaining 0.1%, and Dow Jones futures flat. The previous session saw the Dow close 0.6% higher on defense sector strength, while the Nasdaq fell 0.4% due to weakness in tech giants including Nvidia, Apple, and Meta.

Key Market Drivers:

Two critical events are dominating investor attention:

1. December Non-Farm Payrolls Report: Deutsche Bank forecasts 50,000 payroll additions with unemployment expected to dip slightly to 4.5%. Analysts caution about data reliability, noting five years of annual revisions will be incorporated simultaneously, making initial figures potentially less precise than usual.

1. Supreme Court Tariff Ruling: The court will decide on President Trump's tariff policies. According to AJ Bell's Russ Mould, striking down tariffs could benefit investors but may reduce government revenue, potentially triggering higher Treasury yields with broader market ripple effects.

Sector Performance:

Defense stocks surged Thursday following proposed spending increases under the Trump administration, driving Dow gains. Technology sector faced pressure from major players.

Market Context:

This jobs report arrives after data delays caused by the recent government shutdown, offering what analysts hope will be a "normal" economic snapshot. However, Deutsche Bank's Jim Reid characterizes the initial payrolls data as a "random number generator," suggesting heightened uncertainty around this release.

Implications:

Market direction will likely hinge on both the employment data strength and the Supreme Court's tariff decision, with potential volatility across equities and fixed income markets.