By Angela Moon
NEW YORK (Reuters) - Wall Street was set for a flat open on Friday as investors gave a mixed reaction to a government report showing employment in the United States fell for the first time this year in June.
U.S. stock index futures seesawed following the report, turning between positive and negative to trade flat just ahead of the open.
Non-farm payrolls dropped by 125,000, the largest decline since October, largely because temporary government jobs for the census decreased by 225,000, the Labor Department said.
The weak numbers were a blow to President Barack Obama who has identified job creation as key priority, but some analysts said it could have been worse.
"It's slightly worse than expected. (But) what's happening right now is people are breathing a sigh of relief that it's not worse than this," said Doug Roberts, chief investment strategist at Channel Capital Research at Shrewsbury in New Jersey.
Also, the unemployment rate fell to 9.5 percent, the lowest level since July, as people left the labor force.
With mounting fears of a double-dip recession, the report was closely watched to assess the strength of the economic recovery.
S&P 500 futures were up 2 points and in line with fair value, a formula that evaluates pricing by taking into account interest rates, dividends and time to expiration on the contract. Dow Jones industrial average futures rose 11 points, and Nasdaq 100 futures gained 5 points.
European stocks got a lift from news that Australia ended a damaging dispute with global miners on Friday by dumping its "super profits" tax for a lower resources rent tax backed by big miners. Mining shares such as Rio Tinto
Biotech shares will be in the spotlight. French drugmaker Sanofi-Aventis SA
British power supply systems maker Chloride
Dell Inc
Major indexes closed lower for a fourth straight day on Thursday after suffering their worst quarter since late 2008.
(Reporting by Angela Moon, Editing by Chizu Nomiyama)
