Futures subdues gains amid Alphabet results

U.S. stock index futures were subdued on Monday following a strong jobs report which highlighted the strength in the domestic economy, while investors waited for Alphabet's earnings following a mixed bag of results from other FAANG stocks.

Alphabet Inc rose 0.5 per cent in premarket trading ahead of its quarterly results after the bell and will round up earnings from the FAANG group. The reports have been a mixed bag, with Apple Inc and Facebook Inc posting better-than-expected quarterly results last week, while Netflix Inc and Amazon.com Inc gave a downbeat current-quarter forecast.

Still, the indexes held onto their two-month levels, as recent signs of progress in U.S.-China trade talks and the Federal Reserve's signal of slowing down its pace of monetary tightening led to a collective sigh of relief among investors who have fretted overgrowth. A nonfarm payrolls report on Friday showed U.S. job growth surged in January, with employers hiring the most workers in 11 months. Still, concerns remained that a slowdown in the rest of the world could hurt U.S. earnings, with warnings from bellwethers including Caterpillar Inc.

Nearly half of the S&P 500 companies that have reported Q4 earnings so far, 70.9 per cent beat analysts' expectations, below the last four quarters average of 72 per cent. At 7:16 a.m. ET, Dow e-minis were up 21 points, or 0.08 per cent. S&P 500 e-minis were up 2 points, or 0.07 per cent and Nasdaq 100 e-minis were up 6.5 points, or 0.09 per cent.

Among early movers, Ultimate Software Group Inc climbed 17.7 per cent after the HR software provider agreed to be bought by an investor group led by Hellman & Friedman in a deal valued at about $11 billion. Papa John's International Inc jumped 6.5 per cent after news that hedge fund Starboard Value LP was making a $200 million investment in the pizza chain.

Also in focus will be data at 10:00 a.m. ET which is expected to show factory orders rose 0.2 per cent in November compared with the 2.1 per cent fall in the prior month. Last week the U.S. central bank in a sharp reversal of stance from six weeks ago, pledged to be patient with further interest rate hikes while citing risks including slower growth in China and Europe, U.S.-China trade talks and the impact of a partial government shutdown. Fed Chairman Jerome Powell is expected to give a speech on Wednesday, which will be closely followed by investors.