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Stock futures lose bulk of gains as jobs participation a concern

U.S. stock-index futures mostly erased their gains on Friday as a drop in the labor pool dampened investor cheer over the the government's nonfarm payrolls report for April, which otherwise largely exceeded expectations.

"Today's employment report is quite strong on its face but some beneath the headline data points mitigate our enthusiasm. Investors are likely to find this report mixed and unclear," Dan Greenhaus, chief strategist at BTIG, emailed.

The report had 288,000 jobs created in April from an upwardly revised 203,000 in March, with the jobless rate at 6.3 percent. Expectations called for the addition of 210,000 jobs during April. Analysts polled by Reuters also saw unemployment falling to 6.6 percent.

"The big question that'll come in is the labor participation rate, that's going to be the constant concern here," said Art Hogan, market strategist at Wunderlich Securities, referring to the numbers of those looking for work as declining by 806,000.

Other data out on Friday includes factory orders for March, due at 10 a.m.

Chevron is the major company reporting first-quarter earnings before Wall Street opens. Estee Lauder will also post numbers.

Dow-listed energy company Chevron is seen posting earnings that are down on the same period last year, due to lower production, thinner margins, foreign currency fluctuations, and impairment charges relating to its mining operations.

Earlier on Friday, Pfizer, the world's biggest pharmaceutical company, upped its bid for U.K. rival AstraZeneca. It is now offering £50 ($84) a share, rather than £46.61.

Panmure Research recommended investors wait for a third bid for AstraZeneca, which could push the offer towards £55. It reiterated its "buy" recommendation and £54 price target.

"With tax inversion a significant motive, we await a higher offer before expected rule changes make re-incorporation more difficult," said Panmure analyst Savvas Neophytou in a morning research note.

Frankfurt-listed shares of Pfizer traded 1.9 percent lower on Friday.

Read MorePfizer woos AstraZeneca back to table with raised bid

In other pharmaceutical news, advisers to the U.S. Food and Drug Administration will vote on whether Merck's top-selling prescription asthma and allergy drug, Singulair, should be approved for over-the-counter-use.

Plus, President Barack Obama will give a joint press conference with visiting German Chancellor Angela Merkel on Friday. Merkel will also speak before the U.S. Chamber of Commerce in Washington D.C.

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