Stock Futures Edge Up Ahead of Inflation Data, as Earnings Season
U.S. stock futures ticked up and oil prices declined ahead of fresh data on consumer prices, and amid the start of earnings season, both of which are expected to provide insight into whether inflation concerns are warranted.
Futures tied to the S&P 500 added 0.2% Wednesday, pointing to a pause in the broad-market index’s three-day decline. It is down 0.9% so far this week. Nasdaq-100 futures rose 0.4%, suggesting modest gains for technology stocks after the opening bell.
Stocks have been weighed down by fears about inflation in recent days, stoked by rising energy prices and continued bottlenecks in supply chains. Investors are trying to gauge the effect this could have on central bank support for the economy and whether the higher costs for raw materials and energy will erode profits as third-quarter earnings season kicks off.
“Equity markets need to incorporate the higher uncertainty on central banks’ approaches and the uncertainties on the earnings side,” said Antonio Cavarero, head of investments at Generali Insurance Asset Management. “This doesn’t mean the tide has turned, but some higher caution is probably the way to go for the next few weeks.”
Data on the consumer-price index for September is set to go out at 8:30 a.m. ET. Economists project that inflation remained at an elevated level, boosted by worker shortages and strained supply chains.
“The Fed will be very sensitive to this number. If it comes very far from market expectations, they will have an incentive to prove they are on top of things,” Mr. Cavarero said.
This gauge of inflation came in below expectations in August, although prices remained high. Investors are awaiting Wednesday’s release to see if this was an anomaly or the start of a moderation of inflation.
Several household-name companies reported earnings early Wednesday.
rose 1.6% in premarket trading after reporting revenue and profit that beat analysts’ expectations. JPMorgan’s earnings per share came in slightly above Wall Street’s projections, sending its shares up 0.3%.
shares slipped 1.2% after the company posted a quarterly profit but said it faced pressure from rising fuel prices.
“Have we passed the point of the sweet spot—low costs and explosive demand, to a point where demand is softening and costs are picking up? We do expect to see some signs of that starting to emerge,” said Sebastian Mackay, a multiasset fund manager at Invesco. “I do believe we’ll be in a more rocky patch for equities, where they will be moving sideways or possibly down a little bit.”
The oil-price rally halted following a report that suggested Iran nuclear talks could recommence as soon as this week, prompting some traders to price in a potential higher supply of crude to…
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