US pre-open: Futures mixed as trade tariffs kick-in, jobs report pleases

Stocks are set for a mixed start, on the back of what traders are terming a 'goldilocks' US jobs report for the month of June, although the hit to sentiment from the launch of US trade tariffs against China, overnight, is still acting as a drag.

"This report is generally risk-friendly, as it suggests that the US economy remains in its sweet spot: employers are hiring, however, wages aren’t rising fast enough to trigger sharper than expected rate rises from the Federal Reserve. Hence why S&P 500 futures prices have moved into positive territory in the immediate aftermath of the report," said Kathleen Brooks, research director at Capital Index.

As of 1408 BST, futures for the Dow Jones Industrials were off by 21.0 points to 24,332.0, alongside a gain of 0.50 points for the S&P 500 contract to 2,739.0 and a move to the upside of 7.50 points to 7,133.25 for Nasdaq-100 futures to 7,133.25.

Unemployment rose unexpectedly in June, but only because more Americans were tempted to come out and look for a job, a positive sign perhaps for those hoping to see a so-called 'supply-side' boost to the economy.

Indeed, other aspects of the report appeared to indicate that the labour market was continuing to hum along nicely, albeit with a bit more slack remaining than in May, which is a good thing.

According to the Bureau of Labor Statistics, US non-farm payrolls grew by 213,000 last month, alongside combined upwards revisions to the prior two months' worth of data of 37,000.

In parallel, the rate of unemployment did rise by two-tenths of a percentage point to 4.0%, contrary to expectations for it to remain at 3.8%.

Nevertheless, that was entirely due to a jump of 601,000 in the number of persons in the work-force, whereas only 102,000 more were employed, leaving those now classified as unemployed - but searching for work - up by 499,000 at 6.564m.

Growth in average weekly earnings did, however, fall a tad shy of forecasts for an increase of 0.3% month-on-month, rising instead by just two tenths.

As of 1404 BST, the yield on the benchmark 10-year US Treasury note was off by two basis points to 2.81% and at its intraday low.

On the global trade front meanwhile, 25% tariffs on $34bn-worth of Chinese goods kicked-in one minute past midnight in Washingon DC.

Predictably perhaps, Beijing retaliated in kind just afterwards.

Nevertheless, according to analysts at Oxford Economics, "Besides criticising the US move and vowing to retaliate, today’s statement by China’s Ministry of Commerce also indicated restraints and continued commitment to reform and globalisation."

In the company space, JP Morgan denied a report in the German press that it might be interested in taking a stake in Deutsche Bank.

Shares of Biogen were also higher, after it announced positive Phase II trial results for its Alzheimer's treatment, alongside Japan's Eisai.