Dow futures fall 100 pts; payrolls and banking sector in spotlight

By Peter Nurse 

Investing.com -- U.S. stocks are seen opening mixed Friday, stabilizing after the previous session's selloff with the focus on the upcoming jobs report and the troubled banking sector.

At 07:00 ET (12:00 GMT), the Dow Futures contract was down 100 points or 0.3%, and S&P 500 Futures traded 4 points or 0.1% lower, while Nasdaq 100 Futures climbed 25 points or 0.2%.

The three benchmark equity indices closed sharply lower on Thursday, dragged lower by hefty losses in the banking sector. The blue-chip Dow Jones Industrial Average dropped over 500 points or 1.7%, while the broad-based S&P 500 fell 1.9% and the tech-heavy Nasdaq Composite slipped 2.1%.

The S&P 500 bank index fell 4.1%, its biggest one-day drop in nearly three years on Thursday, with this weakness triggered by SVB Financial Group (NASDAQ:SIVB) - also known as Silicon Valley Bank - announcing an emergency $2.25 billion capital raise to cover expected losses as well as crypto bank Silvergate Capital's (NYSE:SI) decision to wind down operations.

While Silvergate's client base of crypto exchanges and investment platforms is relatively contained, problems at SVB could have more widespread repercussions for the U.S. banking industry.

Nerves are also frayed ahead of the release of the monthly official jobs report, particularly after Federal Reserve Chair Jerome Powell mentioned this data point in his semi-annual testimony to Congress as one of the key indicators the central bank policymakers look at when deciding future monetary policy.

The market is now increasingly betting that March's rate decision by the Fed will be a half-percentage-point hike, an acceleration from the 25 basis point increase in early February.

Analysts expect the economy added 205,000 jobs last month, but they are also waiting to see if January's red-hot 517,000 number will be revised. 

In corporate news, Apple (NASDAQ:AAPL) holds its annual shareholder meeting later in the session, with shareholders set to vote on a number of proposals, including its exposure to China and a report on race and gender pay gaps.

Gap (NYSE:GPS) stock fell over 7% premarket after the retail chain posted a bigger-than-expected fourth quarter loss and forecast weak full-year sales, hit by a slowdown in demand for its apparel.

Oracle (NYSE:ORCL) stock dropped over 4% premarket after it missed quarterly revenue estimates, with the software giant banking on the recent acquisition of electronic medical records firm Cerner (NASDAQ:CERN) for future growth.

Oil prices fell Friday and are heading for their worst weekly loss in five weeks on concerns steep interest rate hikes in the U.S. will stymie economic activity and thus crude demand in the largest consumer in the world.

Also weighing on sentiment this week has been disappointing data out of China, the largest oil importer in the world, suggesting its economic recovery will take some time.

By 07:00 ET, U.S. crude futures traded 0.9% lower at $75.03 a barrel, while the Brent contract fell 0.7% to $80.99. Both benchmarks were on course to lose about 5% this week.

Additionally, gold futures rose 0.2% to $1,838.35/oz, while EUR/USD traded 0.1% higher at 1.0588.