Weak U.S. Futures, Payrolls, Powell’s Speech – What’s Moving Markets

April 4, 2025 — U.S. stock futures traded lower Friday morning, as investors digested a mix of labor market data, looming interest rate uncertainty, and remarks from Federal Reserve Chair Jerome Powell, all of which are stirring fresh volatility in global financial markets.

Futures Point to Lower Open

As of 7:30 a.m. ET, futures tied to the Dow Jones Industrial Average were down 0.4%, while S&P 500 futures dropped 0.5%. The tech-heavy Nasdaq-100 showed a steeper decline, falling 0.7%. The early weakness reflects a cautious mood among investors ahead of today’s crucial nonfarm payrolls report and following Powell’s more hawkish-than-expected tone in remarks delivered Thursday afternoon.

March Jobs Report in Focus

The U.S. nonfarm payrolls report for March is expected to show the addition of around 200,000 jobs, down from February’s robust 275,000, according to economists surveyed by Dow Jones. The unemployment rate is forecast to hold steady at 3.9%, while wage growth is expected to rise modestly.

A stronger-than-expected report could complicate the Fed’s policy path, reinforcing fears that interest rate cuts may be delayed further into 2025. On the other hand, any signs of labor market cooling could ease pressure on the central bank, providing support to equity markets.

Powell Pushes Back on Rate Cut Expectations

In a speech at the University of Chicago on Thursday, Chair Jerome Powell reiterated the Fed’s commitment to bringing inflation back to its 2% target and warned against acting too quickly on rate cuts.

“While inflation has come down from its peak, it remains too high,” Powell said. “We need greater confidence that price stability is firmly in place before adjusting our policy stance.”

His remarks poured cold water on market hopes for an imminent rate cut, sending Treasury yields higher and tech stocks lower in after-hours trading. As of Friday morning, traders were pricing in just a 38% probability of a rate cut at the Fed’s June meeting, according to CME Group’s FedWatch tool, down from over 60% earlier in the week.

Global Market Snapshot

The cautious sentiment in the U.S. is mirrored globally. European stocks are modestly lower, led by weakness in financials and energy, while Asian markets ended the session mixed amid concerns over China’s economic recovery and continued regulatory scrutiny of major tech firms.

Meanwhile, oil prices are ticking higher, with Brent crude trading above $89 per barrel amid renewed tensions in the Middle East and falling U.S. inventories. The U.S. dollar is slightly stronger, buoyed by rising yields and Powell’s hawkish messaging.

Looking Ahead

Investors will be closely watching the payrolls report at 8:30 a.m. ET for clues about the Fed’s next move. Market participants are increasingly focused on how resilient the U.S. economy remains in the face of higher borrowing costs and whether the Fed can orchestrate a so-called soft landing — bringing inflation down without tipping the economy into a recession.

Until then, markets are likely to remain choppy, caught between solid economic data and the Fed’s cautious stance.