Stock index futures inched down on Thursday, as traders turned cautious ahead of the key retail inflation numbers slated to come before the bell.
S&P 500 futures (SPX) -0.1%, Nasdaq 100 futures (US100:IND) -0.1% and Dow futures (INDU) -0.1%.
The 10-year Treasury yield (US10Y) was flat at 4.28%. The 2-year yield (US2Y) was unchanged at 4.63%. The rest of the yield curve can be seen here.
Stocks finished higher on Wednesday, as comments from the Federal Reserve chair Jerome Powell did little to disrupt the narrative of a September rate cut.
Market participants will keep their eyes peeled for the consumer price index report to get more clues on the inflation figures, which could give further hints as to what the Fed’s monetary policy will be for the year.
Economists expect the headline CPI number to rise 0.1% in June, vs. 0.0% in May, bringing the annual rate to 3.1%, easing from 3.3% in the previous month.
Core CPI, which excludes food and energy prices, is forecasted to rise 0.2%, the same pace as in May. On a year-over-year basis, that would bring inflation to 3.4%.
“That CPI release is in particular focus, because there’s been mounting anticipation that the Fed might still deliver two rate cuts this year, with September and December seen as the most likely dates,” Deutsche Bank’s Jim Reid said.
“If there is positive news on inflation, and we get another soft print, then that momentum for a rate cut is likely to build further,” Reid added.
“We have June consumer price inflation data. Fed chair Powell thinks this matters, because politicians think this matters, and Powell thinks politicians are important. Economists, who are actually important, tend to regard headline consumer price data as a rather poor quality statistic,” UBS’ Paul Donovan said.
The weekly initial jobless claims data will also be released at the same time as the CPI, and is expected to see a fall to 236K.
“A few factors will make it hard to spot the underlying trend in jobless claims over the next few weeks. Specifically, in today’s report, the July 4 holiday ought to depress unadjusted claims slightly,” Pantheon Macroeconomics said.
The results of $22B, 30-year bond auction and the Fed balance sheet are also due today.
Source link
