Global shares were subdued as investors braced for a key U.S. jobs report that may justify imminent rate cuts by the Federal Reserve and waited on the passage of a massive U.S. tax and spending bill in Congress.

Wall Street futures were mixed on a shortened trading day ahead of the Independence Day holiday tomorrow.

TSX futures edged higher after Canada’s main stock market notched a new record high yesterday.

The resilience of the U.S. labour market is a major reason the majority of Fed members say they can afford to hold off on cutting rates until they can gauge the real impact of tariffs on inflation.

“These labour market indicators warn of the risk that the unemployment rate could spike to 4.4 per cent, the highest since October, 2021,” said Tony Sycamore, analyst at IG.

“This would quickly increase the probability of a July Fed rate cut to around 70 per cent.”

Overseas, the pan-European STOXX 600 was up 0.1 per cent in morning trading. Britain’s FTSE 100 rose 0.37 per cent, Germany’s DAX was little changed and France’s CAC 40 fell 0.23 per cent.

In Asia, Japan’s Nikkei closed 0.06 per cent higher, while Hong Kong’s Hang Seng slid 0.6 per cent.

 Oil prices eased after gaining 3 per cent in the previous session as investors are wary that higher U.S. tariffs may be reinstated, which could cause lower fuel demand, and as major producers are expected to announce an output hike.

Brent crude futures fell 0.3 per cent to US$68.91 a barrel. West Texas Intermediate (WTI) crude declined 0.3 per cent to US$67.25 a barrel.

In other commodities, spot gold was down 0.3 per cent to US$3,345.79 an ounce. U.S. gold futures eased 0.1 per cent to US$3,356.10.

The Canadian dollar weakened against its U.S. counterpart.

The day range on the loonie was 73.51 US cents to 73.67 US cents in early trading. The Canadian dollar was up about 0.58 per cent against the greenback over the past month. 

The U.S. dollar index, which weighs the greenback against a group of currencies, rose 0.05 per cent to 96.83. 

The euro gave back 0.08 per cent to US$1.1792. The British pound gained 0.13 per cent to US$1.3654.

In bonds, the yield on the U.S. 10-year note was last down at 4.265 per cent.

Japan and Euro zone services and composite PMI

(8:30 a.m. ET) Canada’s merchandise trade balance for May.

(8:30 a.m. ET) U.S. nonfarm payrolls for June. The Street is expecting a gain of 113,000, down from 139,000 in May, with the unemployment rate rising 0.1 per cent to 4.3 per cent.

(8:30 a.m. ET) U.S. initial jobless claims for week of June 28. Estimate is 242,000, up 6,000 from the previous week.

(8:30 a.m. ET) U.S. goods and services trade deficit for May.

(9:45 a.m. ET) U.S. S&P Global Services/Composite PMI for June.

(10 a.m. ET) U.S. factory orders for May. Estimate is a gain of 8 per cent from April.

With Reuters and The Canadian Press