Futures steady as markets await crucial U.S. inflation reading
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Key Highlights
Dow E-minis down 0.17%, S&P 500 up 0.06%, Nasdaq 100 up 0.16% November CPI expected to show 0.3% monthly rise, 2.7% annual increase Core CPI seen steady at 3.3%, crucial for Fed rate cut trajectory
Market Overview
U.S. stock index futures hovered within a narrow range early Wednesday as investors awaited the release of November’s Consumer Price Index (CPI) report at 8:30 a.m. ET. This data is pivotal for shaping Federal Reserve policy expectations ahead of the Dec. 17-18 meeting.
The inflation report is anticipated to reveal a 0.3% monthly increase in headline CPI, bringing the annual rate to 2.7%. Core CPI, which excludes volatile food and energy prices, is forecast to remain unchanged at 3.3% year-on-year.
Jochen Stanzl, chief market analyst at CMC Markets, highlighted that breaking the recent upward inflation trend is critical for sustaining expectations of three Fed rate cuts over the next six months. However, the Fed’s cautious tone persists amid a resilient labor market.
Rate Cut Expectations
Market participants are pricing in an 86% probability of a 25-basis-point rate cut next week, per CME’s FedWatch Tool Friday’s employment report, showing robust job growth alongside a slight unemployment uptick, has bolstered rate cut bets Fed officials have emphasized caution, suggesting the pace of easing next year may slow, particularly as the economy demonstrates resilience
Futures Snapshot
Dow E-minis: Down 75 points (-0.17%)
S&P 500 E-minis: Up 3.5 points (+0.06%)
Nasdaq 100 E-minis: Up 33.5 points (+0.16%)
Wall Street’s major indexes closed lower on Tuesday, weighed by declines in heavyweight technology stocks. However, both the S&P 500 and Nasdaq remain near record highs, bolstered by optimism surrounding artificial intelligence and expectations of easing monetary policy.
Premarket Movers
GameStop (GME): Gained 3% after reporting a Q3 profit driven by cost-cutting measures General Motors (GM): Up 1.2% following its decision to cease robotaxi development at Cruise, redirecting resources to other autonomous initiatives GE Vernova (GE): Fell 4.9% as the CEO signaled caution regarding the wind sector despite resumed turbine installations at two offshore wind farms
Broader Market Sentiment
Technology stocks continue to lead this year’s market rally, driven by the AI boom and falling rate expectations. While December began on a positive note, investor focus remains on inflation and producer prices, with the latter due on Thursday, for insights into the Fed’s path forward.
Key Takeaway
The November CPI report will set the tone for near-term market movements and Fed expectations. Investors should monitor core inflation data closely, as any surprises could reshape the outlook for monetary easing.
Dow E-minis down 0.17%, S&P 500 up 0.06%, Nasdaq 100 up 0.16% November CPI expected to show 0.3% monthly rise, 2.7% annual increase Core CPI seen steady at 3.3%, crucial for Fed rate cut trajectory
Market Overview
U.S. stock index futures hovered within a narrow range early Wednesday as investors awaited the release of November’s Consumer Price Index (CPI) report at 8:30 a.m. ET. This data is pivotal for shaping Federal Reserve policy expectations ahead of the Dec. 17-18 meeting.
The inflation report is anticipated to reveal a 0.3% monthly increase in headline CPI, bringing the annual rate to 2.7%. Core CPI, which excludes volatile food and energy prices, is forecast to remain unchanged at 3.3% year-on-year.
Jochen Stanzl, chief market analyst at CMC Markets, highlighted that breaking the recent upward inflation trend is critical for sustaining expectations of three Fed rate cuts over the next six months. However, the Fed’s cautious tone persists amid a resilient labor market.
Rate Cut Expectations
Market participants are pricing in an 86% probability of a 25-basis-point rate cut next week, per CME’s FedWatch Tool Friday’s employment report, showing robust job growth alongside a slight unemployment uptick, has bolstered rate cut bets Fed officials have emphasized caution, suggesting the pace of easing next year may slow, particularly as the economy demonstrates resilience
Futures Snapshot
Dow E-minis: Down 75 points (-0.17%)
S&P 500 E-minis: Up 3.5 points (+0.06%)
Nasdaq 100 E-minis: Up 33.5 points (+0.16%)
Wall Street’s major indexes closed lower on Tuesday, weighed by declines in heavyweight technology stocks. However, both the S&P 500 and Nasdaq remain near record highs, bolstered by optimism surrounding artificial intelligence and expectations of easing monetary policy.
Premarket Movers
GameStop (GME): Gained 3% after reporting a Q3 profit driven by cost-cutting measures General Motors (GM): Up 1.2% following its decision to cease robotaxi development at Cruise, redirecting resources to other autonomous initiatives GE Vernova (GE): Fell 4.9% as the CEO signaled caution regarding the wind sector despite resumed turbine installations at two offshore wind farms
Broader Market Sentiment
Technology stocks continue to lead this year’s market rally, driven by the AI boom and falling rate expectations. While December began on a positive note, investor focus remains on inflation and producer prices, with the latter due on Thursday, for insights into the Fed’s path forward.
Key Takeaway
The November CPI report will set the tone for near-term market movements and Fed expectations. Investors should monitor core inflation data closely, as any surprises could reshape the outlook for monetary easing.