S&P 500 futures slip after index reached seventh record close of the year

What’s driving markets

Friday also saw the release of payrolls data, which saw a surprisingly strong 353,000 jobs created in January. That U.S. stocks finished higher anyway, despite the bond-market weakness the jobs report triggered, shows the emphasis that the market has been putting on earnings, according to Mike Wilson, Morgan Stanley’s chief U.S. equity strategist.

“We see quality growth continuing to outperform amid strong earnings revisions, particularly relative to lower quality cyclicals and small caps. For now, the internals of the stock market are suggestive of the idea that a stickier rate backdrop is a disproportionate headwind for stocks with poor balance sheets and a lack of pricing power—i.e., lower quality cyclicals and many areas of small caps,” he said.

Federal Reserve Chair Jerome Powell used an appearance on the 60 Minutes program to again push back on the idea the central bank would cut rates in March.

There’s more economic data in store, coming from the ISM services report. That report last month triggered worries about the economy after an unusually low reading for the employment component.