Dow Futures remain subdued as a significant U.S. jobs report is set to underscore the concluding session of a holiday-shortened trading week. The U.S. economy is projected to have added fewer jobs than in the previous month in June, which may affect the Federal Reserve’s approach to interest rate decisions in the upcoming months. Expectations for advancements in mediated discussions between the U.S. and Iran have led to a decline in oil prices, whereas chipmaking stocks are facing another wave of selling pressure.

Dow futures declined on Thursday, indicating a degree of caution among investors in anticipation of the forthcoming U.S. employment figures. By 03:13, the futures contract for the Dow had decreased by 95 points, or 0.2%, the S&P 500 futures had declined by 22 points, or 0.3%, and the Nasdaq 100 futures had dropped by 250 points, or 0.8%. The primary indices on Wall Street experienced a pullback in the previous session, influenced in part by a renewed downturn in semiconductor stocks after a Bloomberg News report indicated that Meta Platforms, the parent company of Facebook, was possibly offloading its surplus computing capacity to outside companies. However, market sentiment did receive some support from Federal Reserve Chair Kevin Warsh, who stated that inflation risks have diminished. Warsh reiterated his stance against providing forward guidance on interest rates and emphasised his dedication to price stability. In response to these comments, traders significantly adjusted their expectations, largely eliminating the possibility of a borrowing cost increase by the Fed in July. Softer-than-anticipated U.S. private payrolls and factory activity data provided additional impetus to the dovish repricing, analysts at Deutsche Bank noted.

Attention is now directed towards the economic calendar, particularly the release of the monthly U.S. nonfarm payrolls later today. Economists anticipate that the U.S. economy experienced an increase of 114,000 jobs in June, a decrease from the previously reported figure of 172,000. The unemployment rate is expected to remain at 4.3%, a figure it has maintained since March. Over the past three months, the crucial NFP reports have exceeded expectations, elevating the three-month average of payrolls to a two-year high of 188,000. In light of the evident resilience in the job market, investors have placed their bets on the notion that Federal Reserve policymakers, eager to tame inflationary pressures stemming from energy costs, may possess greater latitude to increase interest rates this year. However, those expectations have been tempered this week, especially following a distinct report — which lacks the thoroughness of the Labour Department’s NFP figure — indicating that private sector payrolls increased by a lesser amount than anticipated in June. In theory, increasing interest rates can assist in curbing inflation, though this comes with the potential downside of slowing economic growth and subsequently impacting the labour market.

Oil prices declined on Thursday as traders assessed the potential reduction in risks to Middle East crude supplies amid ongoing geopolitical uncertainty. Markets were processing the results of indirect U.S.-Iran discussions this week in Doha, the capital of Qatar, where negotiators wrapped up a new round of technical talks without achieving a breakthrough toward a lasting peace agreement. However, Qatar indicated that the discussions yielded positive progress. U.S. President Donald Trump remarked that his envoys to Qatar had “very good meetings,” while a media report indicated that officials from Washington and Tehran were engaged in indirect lower-level technical conversations. Vice President JD Vance confirmed that negotiations with Iran are ongoing. Despite a recent escalation in tensions, the remarks alleviated certain concerns regarding the viability of a temporary peace agreement between the U.S. and Iran. The prospect of a prolonged halt to hostilities and renewed flows through the Strait of Hormuz has led to a decline in oil prices, returning them to approximately pre-conflict levels. This development alleviates concerns regarding potential energy-driven price surges. “[T]he newsflow helped to bring oil prices down and ease investor concern about inflation,” noted the analysts from Deutsche Bank.

Asian semiconductor stocks declined on Thursday, mirroring the overnight selloff in U.S. chipmakers. This movement followed media reports indicating that OpenAI had made substantial efficiency gains in operating its AI models, while Meta was investigating methods to monetise its surplus AI computing capacity. The Information reported that OpenAI engineers had developed software optimisations capable of cutting inference costs by roughly half, reducing the number of graphics processors needed to serve some ChatGPT users. Reports on Wednesday indicated that Meta was contemplating the provision of customer access to AI models and surplus computing power via a new cloud service, while Apple was reported to have contacted limited Chinese memory-chip manufacturers for particular devices. The developments have raised apprehensions that AI firms might enhance their ability to derive greater value from current hardware, which could diminish the immediate need for new chip acquisitions. South Korea’s prominent semiconductor manufacturers experienced a decline, including Samsung Electronics and SK Hynix, alongside Japan’s Advantest Corp and Tokyo Electron. Taipei-listed Taiwan Semiconductor Manufacturing Co also experienced a decline.

The Trump administration is anticipated to unveil voluntary standards for advanced artificial intelligence models as early as next week, according to sources, as Washington seeks to create a more predictable framework for firms engaged in the development of frontier AI systems. According to the report, the proposed framework aims to establish a unified set of voluntary benchmarks for assessing highly capable AI models prior to their release, supplanting the recent ad hoc approach that has resulted in ambiguity for developers regarding regulatory expectations. The initiative follows a series of government interventions concerning next-generation AI systems. Earlier this month, U.S. officials enacted temporary export restrictions on Anthropic’s latest models due to cybersecurity concerns, which were subsequently lifted this week. Meanwhile, OpenAI was requested to initially restrict access to its forthcoming GPT-5.6 model to government-approved users prior to a wider release.