Morgan Stanley Research previews the US May jobs report on Friday.

"We forecast payrolls rose 65k and private payrolls rose 75k. The federal government layoffs remain a drag on headline payrolls, and we also incorporate drags on private payrolls from the transportation sector," MS notes.

"For the household survey, we expect another 4.3% unemployment rate (still on the cusp of 4.2%) and an unchanged labor force participation rate. Average hourly earnings likely rise 0.3% m/m, and the 12-month pace slows 0.1 pp to 3.5% y/y," MS adds.