Stock futures are mixed Thursday night as investors look ahead to the second in a pair of closely watched inflation reports this week.
Futures tied to the Dow Jones Industrial Average added 15 points, or 0.04%. S&P 500 futures and Nasdaq 100 futures were both down 0.16% and 0.11% respectively.
The moves follow a muted day on Wall Street. The 30-stock Dow inched up by around 15 points, while the S&P 500 finished marginally lower. The technology-heavy Nasdaq Composite closed at its flat line.
Investors focused on inflation data released Thursday morning. December’s consumer price index came in modestly hotter than economists forecasted, with prices up 0.3% on the month and 3.4% from a year ago.
Sticky inflation is a negative for market participants hoping that interest rate cuts from the Federal Reserve are on the horizon, said Greg Bassuk, CEO of AXS Investments. Markets are pricing in a roughly 70% likelihood that the central bank will first lower the interest level at its March meeting, according to the CME FedWatch Tool.
But Bassuk said the monthly price index reading may not be enough for the market to change course on its interest rate expectations. That can offer an explanation for why the major indexes finished largely flat rather than significantly down.
“The sentiment had been very strong around the possibility of rate cuts coming sooner rather than later,” Bassuk said. “Today’s CPI data throws some cold water on that excitement.”
Elsewhere, crypto-related shares took a hit following the Security and Exchange Commission’s approval of a rule change that paves the way for exchange-traded funds connected to bitcoin. Riot Platforms and Marathon Digital tumbled about 16% and 12%, respectively, in the session. Coinbase and MicroStrategy dropped more than 6% and 5%, respectively.
On the week, the major averages are heading for modest gains. The Dow is up about 0.7%, while the S&P 500 is tracking for a 1.8% advance. The Nasdaq is the outperformer, up more than 3% through Thursday’s close.
The next big inflation test comes Friday morning with the producer price index. While the consumer index follows the price of a basket of items purchased by shoppers, Friday’s data tracks selling prices received by domestic producers. Economists polled by Dow Jones expect the December producer reading to rise 0.1%.
Investors will also watch for earnings reports from major banks including JPMorgan Chase, Citigroup, Bank of America and Wells Fargo due before the bell.
