Markets in Europe and Asia are mixed this morning, with the exception of China, where stocks fell due to an unexpected deterioration in manufacturing. The US S&P 500 futures are up nearly a full percentage point, premarket, following positive earnings calls from Meta and Microsoft. However, US Federal Reserve Chairman Jerome Powell’s rate-setting speech yesterday highlighted “downside risks” to the labor market.
Powell reiterated that interest rates will remain at 4.25% and emphasized that inflation is above target. He also mentioned that the labor market looks solid, but faces challenges due to a sluggish hiring market and one-off moves in government and education hiring. Economists warn that US employment may weaken in the coming months.
Analysts closely watched Powell’s speech for clues on future rate decisions, with some predicting a possible rate cut if labor market concerns escalate. The jobs number is set to be released tomorrow, which will determine how stocks react. Markets are currently:
– S&P 500 futures up 1% premarket
– STOXX Europe 600 up 0.14%
– U.K.’s FTSE 100 up 0.52%
– Japan’s Nikkei 225 up 1.02%
– China’s CSI 300 Index down 1.82%
– South Korea KOSPI down 0.28%
– India’s Nifty 50 up 0.08%
Bitcoin remains above $118K.
Source: https://fortune.com/2025/07/31/the-feds-powell-said-the-phrase-downside-risks-six-times-in-his-press-conference-yesterday-is-that-bad-news-for-tomorrows-jobs-number