Futures perk up after 4-day rout ahead of inflation data

Stock futures rose sharply on Friday, suggesting Wall Street was prepared to set aside jitters that culminated in a four-day losing streak, with investors growing more cautious about the COVID-19 pandemic's impact on the economy.

During the regular session, major benchmarks logged a 4th consecutive day of losses. Traders have been struggling to reconcile a seemingly hot jobs market with soaring coronavirus infections that have blunted the recovery's momentum. However, the slowing momentum also gives the Federal Reserve room to keep its foot on the monetary policy pedal, which has given stocks a boost.

Yet playing in the background is the COVID-19 pandemic, where deaths and hospitalizations are soaring because of the more contagious Delta variant. On Thursday President Joe Biden announced on Thursday a sweeping set of mandates designed to nudge hesitant citizens into getting vaccinated. The Dow Jones Industrial Average and S&P 500 Index have now retreated four days, but the technologylaced Nasdaq has fared slightly better, having dropped 2 days in a row. Investors have been in a foul mood since August's jobs data fell far short of market expectations last week, tempering hopes for the fourth quarter and getting September off to a rough start.

"You look at the markets and they've been amazingly calm and we think September is right for a pullback," G Squared Wealth CFA CIO Victoria Greene told Yahoo Finance Live on Thursday.

"We're kind of in a purgatory." However, at least 2 pieces of jobs data this week have pained a different picture than August's nonfarm payrolls. Labor Department data showed that open jobs hit yet another series record, with workers quitting their jobs en masse, and nearly 11 million positions unfilled. And on Thursday, new jobless claims set a new pandemic era low at 310,000, temporarily allaying fears about the economy.

On Thursday, Biden ordered that all businesses with over 100 employees require workers to get inoculated or be tested weekly, and declared his intent to require all federal employees to get their shot. And a growing number of private employers are already imposing vaccine mandates, even as many push back return-to-office plans as the Delta variant rears its head.

"We've been patient, but our patience is wearing thin," a clearly frustrated Biden declared, addressing the number of vaccine-resistant holdouts - many of whom have flooded hospitals around the country. "And your refusal has cost all of us." Separately, the president spoke with Chinese leader Xi Jingping for the first time in months, which also provided modest comfort to investors. While little progress was made, the call highlighted how the world's two largest economies - which have a raft of differences on critical policy issues between them to work out - are still keeping the lines of communication open.

"The risk-on mood, perhaps spurred by the first talks between Biden and Xi in seven months, is helping lift equity markets and is weighing on the dollar against most of the major currencies," noted Marc Chandler, chief market strategist at Bannockburn Global Forex, in a morning note he entitled "frenemies talk, but progress elusive."

Meanwhile The European Union's drugs regulator said it was awaiting more data on Russia's Sputnik V and a rival COVID-19 vaccine by China's Sinovac Biotech before it can progress on its rolling reviews of the two shots.

"For these vaccines the discussion with the companies has been quite constructive but it looks like there are more data that need to be submitted to us before we can progress with the different rolling reviews," the European Medicines Agency's (EMA) head vaccines strategy, Marco Cavaleri, told a press briefing.

He added EMA would continue to review data on German biotech firm CureVac's shot over the next few weeks before a conclusion can be drawn. Commenting on EMA's fourth ongoing rolling review, of a shot developed by U.S. firm Novavax, he said its manufacturing would be discussed further over the next few weeks and an overall conclusion of the review is possible before year-end.