Stock index futures pointed to a lower open on Friday after a weak employment report dampened hopes for a strong rebound in the labor market.

The Labor Department said U.S. employers unexpectedly cut 85,000 jobs in December, while economists forecast that payrolls would be unchanged. The government revised November data to show the economy added 4,000 jobs rather than lost 11,000, as initially reported.

Basically the economy continues to take three steps forward and two steps back. The employment numbers have been moving in a better direction. Here is a day when we take a step back, said David Katz, chief investment officer at Matrix Asset Advisors in New York.

S&P 500 futures lost 3.1 points and were below 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 dipped 15 points, and Nasdaq 100 futures fell 7 points.

James Bullard, president of the St. Louis Federal Reserve Bank, said Friday it would be good to see more improvement in the U.S. job market before exiting some stimulus programs. Speaking to university students in Shanghai, Bullard said the U.S. economy was improving, but some policies to support the recovery should not be withdrawn yet.

In corporate news, Bank of America Corp will pay bonuses to its investment bankers that are close to 2007 levels, as it tries to stem defections following the takeover of Merrill Lynch, the Wall Street Journal reported.

Citigroup lowered fourth-quarter earnings views on Goldman Sachs Group Inc , Morgan Stanley and JPMorgan Chase & Co , and expects the three companies to report lower revenues from their fixed income, currency and commodities segments.

Goldman Sachs was sued by an Illinois pension fund seeking to recover billions of dollars in bonuses and other compensation being awarded for 2009, saying shareholders were harmed.

Exxon Mobil Corp is looking to sign a contract for a Transocean Ltd rig capable of drilling in Arctic waters that will cost up to $1 billion to build, according to a source.

(Reporting by Angela Moon; additional Reporting by Ryan Vlastelica; editing by Jeffrey Benkoe)