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U.S. unemployment rate rises to 4.1%

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Tesla extends gains

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Macy's up on report Arkhouse, Brigade Capital raise buyout

offer

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Futures up: Dow 0.12%, S&P 500 0.07%, Nasdaq 0.16%

(Updated at 8:47 a.m. ET)

By Ankika Biswas and Lisa Pauline Mattackal

July 5 (Reuters) - Wall Street's main indexes were on

track to open higher on Friday as markets reopened after the

July 4 holiday, with data showing that U.S. job growth slowed to

a still-healthy pace in June.

The Labor Department's report showed non-farm payrolls rose

by 206,000 jobs in June, higher than the expected 190,000

increase. However, numbers for May were revised sharply lower to

218,000 from 272,000.

The unemployment rate came in at 4.1%, where it was expected

to remain unchanged at 4%. Average hourly earnings rose 0.3%, as

expected, and lower than the 0.4% rise in May.

"It's a relatively benign report. The market was generally

expecting the job gains to be a little bit lower, but the number

was lower than May's report that had really worried some

people," said Emily Bowersock Hill, CEO of Bowersock Capital

Partners.

"If you're the Fed, you're saying - what happened in May is

not quite as hot as we thought. The data isn't bad enough to

alarm markets, and not bad enough to worry the Fed."

The softer reading supported the case for the Federal

Reserve to cut interest rates in September, which comes on the

heels of the ADP Employment and weekly jobless claims reports

this week that signaled easing labor market conditions.

Chances of a 25-basis point September rate cut rose to 72%

after the data, according to CME Group's FedWatch tool, from

66%.

With Treasury yields falling after the data, megacaps

including Alphabet, Amazon.com ( AMZN ) and Meta

Platforms ( META ) were up around 0.4% each.

Tesla rose 1.9% after hitting its highest level

since early January on Wednesday.

Earlier this week, data also showed a measure of services

sector activity dropped to a four-year low and factory orders

slumped unexpectedly, pointing to the U.S. economy losing steam

and prompting market participants to strengthen their bets for

multiple rate cuts this year.

That helped the S&P 500 and the Nasdaq notch record closing

highs during Wednesday's holiday-shortened trading. With the

equity market also staying shut for U.S. Independence Day on

Thursday, trading volumes have been light throughout the week.

At 8:47 a.m. ET, Dow e-minis were up 46 points, or

0.12%, S&P 500 e-minis were up 4 points, or 0.07%, and

Nasdaq 100 e-minis were up 32 points, or 0.16%.

All the three major Wall Street indexes are poised for

weekly gains, after high-momentum top technology stocks steered

the S&P 500 and the Nasdaq to strong gains in the first half of

the year.

With second-quarter earnings on the horizon, it remains to

be seen whether Wall Street's rally will broaden beyond major

megacap stocks and whether earnings for those companies can

continue to support steep valuations.

Macy's jumped 6.9% after a report said Arkhouse

Management and Brigade Capital raised their bid to buy the

department store chain for about $6.9 billion.

Cryptocurrency-related stocks including Coinbase Global ( COIN )

, Riot Platforms ( RIOT ) and Marathon Digital ( MARA )

lost 5%-7% after bitcoin slumped to a more than

four-month low.