Wall St futures edge higher ahead of inflation data
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[October 13, 2022] By
Bansari Mayur Kamdar and Ankika Biswas
(Reuters) -Wall Street futures ticked
higher on Thursday, ahead of a closely watched U.S. inflation report
that could offer clues on how successful the Federal Reserve has been in
its battle against decades-high inflation.
The Labor Department's consumer prices index (CPI) report, due at 8:30
am ET, will likely show headline CPI to have gained at an annual pace of
8.1% in September, lower than an 8.3% increase in August, according to a
Reuters poll.
However, the core CPI, which eliminates volatile food and fuel prices,
is estimated to have risen 6.5% last month, up from a 6.3% rise in
August.
"CPI will tell them (Fed policymakers) how effective they are in trying
to bring and restore price stability back to the U.S. economy with their
tightening cycle," said Jeffrey Schulze, director and investment
strategist at ClearBridge Investments.
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The report follows data on Wednesday that showed U.S. producer prices
increased more than expected in September amid strong gains in the costs
of services and goods, suggesting inflation could remain uncomfortably
high for a while.
The latest batch of economic data could cement the case for a fourth big
rate hike by the central bank, with money markets pricing in a 92%
chance of a 75 basis point increase at the Fed's November rate-setting
meeting. [FEDWATCH]
The tech-heavy Nasdaq and the S&P 500 fell for six straight sessions on
growing fears that aggressive tightening by the Fed could tip the
world's largest economy into a recession.
Minutes from last month's Fed meeting showed policymakers agreed they
needed to maintain a more restrictive policy stance, and Fed Chair
Jerome Powell vowed that they would "keep at it until we're confident
the job is done."
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Raindrops hang on a sign for Wall Street
outside the New York Stock Exchange in Manhattan in New York City,
New York, U.S., October 26, 2020. REUTERS/Mike Segar
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At 6:43 a.m. ET, Dow e-minis were up 152 points, or 0.52%, S&P 500
e-minis were up 20.25 points, or 0.56%, and Nasdaq 100 e-minis were
up 35.25 points, or 0.33%.
Third-quarter earnings reports will also help determine the impact
of higher prices on company profits, with analysts now expecting
profit for S&P 500 companies to have risen just 4.1% from a year
ago, much lower than an 11.1% increase expected at the start of
July, according to Refinitiv IBES data.
Shares of BlackRock Inc dipped 0.2% in premarket trading, after the
world's largest asset manager posted a 16% drop in third-quarter
profit as volatile global markets pressured fee income.
Megacap growth and technology stocks such as Meta Platforms Inc,
Alphabet Inc, Nvidia Corp and Tesla Inc were trading flat, while
keeping track of a small move higher in the 10-year benchmark
Treasury yield. [US/]
Also on tap is a report that is expected to show 225,000 Americans
filed for unemployment benefits last week, up from 219,000 in the
week prior to that.
(Reporting by Bansari Mayur Kamdar, Ankika Biswas and Shreyashi
Sanyal in Bengaluru; Editing by Saumyadeb Chakrabarty and Anil
D'Silva)
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