Wall Street is set to fall when trading opens Friday on renewed worries about inflation after a report showed wages for U.S. workers are accelerating faster than expected.
Futures for U.S. stock indexes fell sharply immediately after the government released the stronger-than-expected data on both wages and hiring. The report raised concerns that inflation may prove to be even stickier than feared, which could prevent the Federal Reserve from easing back on its big interest-rate hikes that are hurting the economy.
Futures for the S&P 500 were down 1.6% with a little more than half an hour before the opening bell for trading of stocks. Futures for the Dow were down 1.2% and for the Nasdaq 100 were down 2.1%.
The government report showed that wages for workers rose 5.1% last month from a year earlier. That's an acceleration from October's 4.9% gain and easily topped economists' expectations for a slowdown. While that's good news for workers who are struggling to keep up with inflation, the Federal Reserve worries too-strong gains could cause high inflation to become further entrenched in the economy.
Employers also added 263,000 jobs last month, above forecasts for 200,00, while the unemployment rate held steady at 3.7%.
Fed officials have signaled that the unemployment rate needs to be at least 4% to slow inflation. It's in the midst of raising interest rates quickly in hopes of slowing the economy just enough to undercut inflation.
The stronger-than-expected jobs and wage data sent Treasury yields jumping on expectations the Fed may have be more aggressive about raising rates to get inflation under control.
The yield on the two-year Treasury jumped to 4.34% from 4.24% late Thursday. The 10-year yield, which helps set rates for mortgages and many other loans, rose...
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