US pre-open: Stock futures fall ahead of non-farm payrolls

US stock futures fell moderately on Friday as investors awaited the non-farm payrolls report.

S&P 500 futures dropped 0.4% to 2,044, while Dow Jones Industrial Average futures shed 0.3% to 17,537 and Nasdaq-100 futures lost 0.5% to 4,455.

The US non-farm payrolls report at 1330 BST will take centre stage as the Federal Reserve is taking into account the data in considering the timing of its next interest rate hike.

Analysts predict the US added 205,000 jobs in March and the unemployment rate held at 4.9%.

“This more restrained approach from investors is something we quite often see on jobs day as not only do we get a raft of potentially high impact data, but with every Fed meeting now being ‘live’, it has the potential to impact the outcome of the next meeting,” said Craig Erlam, senior market analyst at Oanda.

“It will be interesting to see how markets respond to the jobs report today given that Janet Yellen appeared to all but reject the possibility of a hike in April, or even the next few months, earlier this week.”

Other US economic data on the agenda includes the ISM manufacturing index at 1500 BST and the University of Michigan’s consumer confidence survey at 1500 BST.

Elsewhere, Asian stocks were in the red after Standard & Poor’s cut the outlook for China’s credit rating to negative from stable, saying the nation’s economic rebalancing is likely to take longer than previously expected.

The Nikkei was dragged lower after a survey showed business sentiment among Japan’s big manufacturers fell to the lowest in nearly three years in the first quarter.

The headline index gauging big manufacturers' sentiment stood at +6 in March, half the level seen three months ago and worse than a median market forecast of +8, the Tankan survey revealed.

Investors seemed to shrug off positive Chinese data on manufacturing and services.

China’s official manufacturing purchasing managers’ index rose to 50.2 in March from 49.0 the previous month, beating expectations for a reading of 49.3. A reading above 50 signals an expansion while a level above that indicates a contraction.

The non-manufacturing PMI also edged higher in March to 53.8 from 52.7 a month earlier.

Caixin’s private PMI on China manufacturing increased to 49.7 in March from 48 in February, exceeding forecasts of 48.3.

Meanwhile, oil prices continued to slide on concerns about a supply glut. West Texas Intermediate crude fell 2.2% to $37.51 per barrel and Brent crude declined 2.1% to $39.48 per barrel to 1225 BST.

On the corporate front, Starwood Hotels & Resorts Worldwide Inc. and Marriott International Inc. will be in focus as China’s Anbang Insurance Group Co. backed away from its $14bn bid for Starwood.

Tesla Motors Inc. could move after unveiling its more affordable Model 3 electric car late Thursday.