Stock futures took a cautious step back on Thursday evening as investors prepared themselves for the upcoming release of January's significant jobs report. Futures tied to the Dow Jones Industrial Average saw a slight decline of 22 points, or approximately 0.05%. Similarly, both S&P 500 and Nasdaq 100 futures experienced a marginal dip of around 0.1%.

In extended trading sessions, attention turned to Amazon, which saw its stock tumble by 4%. Despite posting strong fourth-quarter top- and bottom-line results, Amazon's guidance for the first quarter of 5% to 9% revenue growth disappointed investors, marking its weakest growth outlook on record. This cautious forecast overshadowed the company's positive quarterly performance.

During Thursday's main trading hours, the S&P 500 managed a modest rise of nearly 0.4%, while the Nasdaq Composite added 0.5%. The Dow Jones Industrial Average, however, dipped by roughly 0.3%. Despite these mixed results, all three major indices are on track for modest weekly gains. The S&P 500 is poised for a 0.7% advance, the Nasdaq is looking at an increase of 0.8%, while the Dow shows a smaller week-to-date gain of about 0.5%.

This week, markets have successfully rebounded from a Monday sell-off, which followed President Donald Trump's announcement of 10% tariffs on China. In a move seen as a positive gesture, Trump agreed to pause 25% levies on Canada and Mexico, easing some investor concerns. However, the potential for increased market volatility remains, as noted by BD8 Capital Partners CEO Barbara Doran on CNBC. She emphasized that the current valuations add another layer of unpredictability to the market landscape.

As attention shifts to Friday morning's jobs report release, traders are focused on the anticipated nonfarm payroll growth of 169,000 jobs for January, a decrease from December's 256,000. The unemployment rate is expected to remain steady at 4.1%, according to a survey conducted by Dow Jones.

Investor sentiment, meanwhile, has shown signs of bearishness. The latest weekly survey from the American Association of Individual Investors reveals that pessimism toward U.S. stocks has risen to 42.9%, the highest in 15 months. This compares with the historical pessimistic average of just 31.0%. Bullish sentiment has decreased to 33.3%, while the historical average stands at 37.5%. Neutral sentiment accounts for the remaining fraction, illustrating a cautious outlook among investors.

A majority of surveyed investors, 52.5%, now view U.S. stocks as overvalued, reflecting a general sentiment of caution. About 36.9% perceive mixed valuations across different sectors, while a minority of 7.1% believe stocks are fairly valued. Only a minuscule 1.4% consider stocks to be undervalued.

Some experts liken the current market climate to "Cat in The Hat Markets," referencing the chaos and unpredictability described by Peter Atwater of Financial Insyghts. Atwater draws parallels to the erratic market movements that are quickly corrected by the end of the trading day, creating a false sense of security among bullish traders.

As futures tied to the Dow Jones Industrial Average dipped further by 49 points, or 0.1%, and both S&P 500 and Nasdaq 100 futures edged down approximately 0.2%, investors remain on edge about the potential for future market disruptions. Atwater warns that while bulls currently exploit intraday volatility, there could be a reckoning when this market pattern ultimately leads to unforeseen consequences.