Wall Street is poised for a higher open on Tuesday as investors focus on the latest producer price index (PPI) data, which could signal future Federal Reserve actions. Donald Trump’s reappearance on the social media platform X and the return of institutional investors to U.S. stocks are also capturing market attention.
- July PPI Data in Focus The U.S. producer price index (PPI) for July, set to be released before the market opens on Tuesday, is anticipated to influence trading ahead of the consumer price index (CPI) report due Wednesday. Analysts expect a 0.2% monthly increase in the PPI, with an annual headline rise of 2.3%, down from the previous month’s 2.6%. The core PPI, excluding food and energy, is also projected to rise 0.2% month-over-month and 2.7% year-over-year, compared to 0.4% and 3.0%, respectively.
This data will be scrutinized to gauge whether the Federal Reserve might opt for a 50 basis point or a 25 basis point rate cut in September. Currently, traders are split on the expected move, according to the CME FedWatch tool.
- Stock Futures Rise; Home Depot Earnings Awaited
U.S. stock futures edged higher ahead of the inflation data release. By 04:20 ET (08:20 GMT), Dow futures were up by 84 points (0.2%), S&P 500 futures by 20 points (0.4%), and Nasdaq 100 futures by 104 points (0.6%). Monday saw mixed trading, with the Dow Jones Industrial Average falling 140 points (0.4%), the S&P 500 ending flat, and the Nasdaq Composite gaining 0.2%. The day’s spotlight will be on Home Depot (NYSE: HD) as it reports earnings before the bell. - Trump’s Return to X
Donald Trump re-engaged with social media on X, formerly Twitter, following a three-year hiatus. His return, marked by a discussion with X owner Elon Musk, comes amid a challenging period for his presidential campaign. Trump’s account had been suspended in 2021 after allegations of inciting violence during the Capitol attacks. Musk restored the account post-acquisition. Trump’s Media & Technology Group (NASDAQ: DJT) saw a 5% drop in shares on Monday, with Truth Social, Trump’s previous platform, facing decreased relevance. - Institutional Investors Return to U.S. Stocks
Data from Bank of America reveals that institutional investors were net buyers of U.S. stocks last week, marking a $6 billion influx for the first time in five weeks. This rebound was notable as it was one of the largest inflows since 2008. Tech and communication services stocks saw the most significant inflows, while hedge funds and private clients were net sellers. - Crude Oil Prices Dip
Crude oil prices fell on Tuesday, ending a five-day winning streak as traders took profits and expressed concerns over demand growth. U.S. crude futures (WTI) were down 0.4% to $79.75 a barrel, and Brent crude dropped 0.4% to $81.98 a barrel. Despite recent gains fueled by Middle East tensions, both benchmarks have declined about 3% over the past month due to sluggish demand, especially in China. The Organization of the Petroleum Exporting Countries (OPEC) cut its 2024 global demand forecast on Monday, the first reduction since July 2023.
