S&P futures vs fair value: +6.50. Nasdaq futures vs fair value: +12.80.
The stock market is on track for a higher open as futures on the S&P 500 trade seven points above fair value.
Index futures held modest gains through the bulk of the night, climbing to highs during the past 45 minutes after the Nonfarm Payrolls report crossed the wires. According to the report, payrolls increased by 223,000 in June, which was below the Briefing.com consensus of 230,000. Furthermore, the Unemployment Rate dropped to 5.3% from 5.5%, but that was a result of a large exodus from the labor force. As a result, the participation rate has dropped to its lowest level since October 1977.
Also of note, hourly earnings were unchanged while the consensus expected an increase of 0.2%. In all likelihood, this is why equity futures jumped to highs as the lack of wage growth makes the Federal Reserve less likely to begin hiking rates in the near term.
Treasuries surged off their lows in reaction to the report with the benchmark 10-yr yield now down four basis points at 2.38%.
The Factory Orders report for May (consensus -0.5%) will be released at 10:00 ET.
