U.S. stock index futures moved little in evening deals on Wednesday as investors hunkered down ahead of key consumer inflation data that is likely to factor into the outlook for interest rates.
Futures steadied after a positive session on Wall Street, with the Dow hitting record highs after the minutes of the Federal Reserve’s September meeting showed a substantial number of policymakers backed its 50 basis point cut.
But the minutes also showed policymakers not committing to any particular pace of cuts in the future, which kept investors skittish over just how much rates will fall this year.
S&P 500 Futures steadied at 5,840.0 points, while Nasdaq 100 Futures were flat at 20,457.25 points by 19:17 ET (23:17 GMT). Dow Jones Futures were flat at 42,830.0 points.
CPI data awaited for more rate cues
Focus was now squarely on consumer price index data due on Thursday, for more cues on inflation and interest rates.
The reading is expected to show a mild decline in CPI inflation, while core CPI- which excludes volatile food and energy prices- is expected to remain steady. Sticky inflation gives the Fed less impetus to cut interest rates at a fast pace.
This notion was furthered by strong payrolls data released last week, which wiped out bets for another 50 bps cut in November.
Traders were pricing in a 75.5% chance for a 25 bps cut, and a 24.5% chance for a hold in November, CME Fedwatch showed.
Still, strength in the labor market and sticky inflation point to some resilence in the U.S. economy, diminishing the prospect of a recession in the coming months. This notion supported Wall Street, with economically sensitive sectors logging strong gains.
The S&P 500 rose 0.7% to 5,792.04 points on Wednesday, while the Dow Jones Industrial Average surged 1% to 42,512.0 points- a record closing high. The NASDAQ Composite rose 0.6% to 18,291.82 points.
Q3 earnings season set to begin
Focus this week is also on the third-quarter earnings season, with a string of major banks set to report on Friday.
JPMorgan Chase & Co (NYSE:JPM), Wells Fargo & Company (NYSE:WFC) and Bank of New York Mellon (NYSE:BK) are set to report third-quarter earnings on Friday, while Goldman Sachs Group Inc (NYSE:GS), Bank of America Corp (NYSE:BAC), and Citigroup Inc (NYSE:C) will report earnings next week.
Earnings from Johnson & Johnson (NYSE:JNJ), Unitedhealth Group (NYSE:UNH) and Walgreens Boots Alliance Inc (NASDAQ:WBA) are also due early next week.
