Wall St set for higher open as inflation data keeps Fed rate-cut hopes intact
For a Reuters live blog on U.S., UK and European stock markets, click LIVE/ or type LIVE/ in a news window
CPI rises 0.2% in October as forecast
Amgen gains after dismissing concerns related to its new weight-loss drug
Rivian soars after Volkswagen increases investment
Spirit Airlines plummets after report says preparing for bankruptcy filing
Futures up: Dow 0.12%, S&P 500 0.17%, Nasdaq 0.12%
Updated at 8:47 a.m. ET/1347 GMT
By Purvi Agarwal and Lisa Pauline Mattackal
Nov 13 (Reuters) -U.S. stocks were on track to open higher on Wednesday after in-line consumer price inflation data kept the Federal Reserve on track to cut interest rates in December.
The consumer price index rose 0.2% for the fourth straight month, the Labor Department's Bureau of Labor Statistics said, and advanced 2.6% on an annual basis. Excluding the volatile food and energy components, the CPI increased 0.3% in October.
The numbers were in line with economists' forecasts, with futures reversing early losses following the data.
"The market is already a little bit on edge about the inflationary possibilities for 2025 under a new administration," said Ross Mayfield, investment strategist, Baird.
"The fact that (CPI) came in line ... gives markets a chance to breathe and focus on the other things that have been moving it lately."
Expectations for a 25-basis point interest rate cut at the Fed's December meeting jumped to 72% after the data, from around 58%, according to CME FedWatch.
Dow E-minis 1YMcv1 were up 51 points, or 0.12%, S&P 500 E-minis EScv1 were up 10.5 points, or 0.17%, and Nasdaq 100 E-minis NQcv1 were up 25 points, or 0.12%.
Futures tracking rate-sensitive small-cap companies RTYcv1 also reversed course to jump 0.9% following the release of the CPI data.
All three major indexes closed lower on Tuesday, also pressured by rising U.S. Treasury yields on expectations that President-elect Donald Trump's policies could exacerbate inflation. The benchmark 10-year Treasury yield US10YT=RR eased back to below 4.4% after Wednesday's CPI data.
EV maker Tesla TSLA.O gained 2.9% after Trump named CEO Elon Musk as a co-leader of a newly created Department of Government Efficiency.
Despite the declines on Tuesday, Wall Street has been largely upbeat over the past few days, expecting Trump's pro-business stance and possible tax cuts to buoy corporate growth, even as some worries remain over higher tariffs and inflation.
The S&P 500 .SPX has gained about 3.5% since the close on Nov. 5, and is on track for year-to-date gains of more than 25%.
A Bank of America's monthly fund manager survey showed global investors see higher growth than they did before, as well as an increase in inflation, in the wake of the U.S. election results.
Spirit Airlines' SAVE.N shares plunged 59% after a report the U.S. carrier is preparing to file for bankruptcy protection, while the company said it is in talks with creditors.
EV maker Rivian RIVN.O soared 10% after Volkswagen VOWG_p.DE on Tuesday raised its investment in the company by 16% to $5.8 billion.
Amgen AMGN.O gained 3% after the company said there was no link between its experimental weight-loss drug and changes in bone mineral density, following data from an early-stage study that weighed on the stock in the prior session.
Caterpillar CAT.N slipped 1.1% after brokerage Evercore ISI downgraded the heavy equipment maker's shares.
Fed officials Alberto Musalem and Jeffrey Schmid are scheduled to speak later in the day.
Rates and inflation https://tmsnrt.rs/3U8HdD2
Reporting by Lisa Mattackal and Purvi Agarwal in Bengaluru; Editing by Shounak Dasgupta
Related Assets
Latest News
Disclaimer: The XM Group entities provide execution-only service and access to our Online Trading Facility, permitting a person to view and/or use the content available on or via the website, is not intended to change or expand on this, nor does it change or expand on this. Such access and use are always subject to: (i) Terms and Conditions; (ii) Risk Warnings; and (iii) Full Disclaimer. Such content is therefore provided as no more than general information. Particularly, please be aware that the contents of our Online Trading Facility are neither a solicitation, nor an offer to enter any transactions on the financial markets. Trading on any financial market involves a significant level of risk to your capital.
All material published on our Online Trading Facility is intended for educational/informational purposes only, and does not contain – nor should it be considered as containing – financial, investment tax or trading advice and recommendations; or a record of our trading prices; or an offer of, or solicitation for, a transaction in any financial instruments; or unsolicited financial promotions to you.
Any third-party content, as well as content prepared by XM, such as: opinions, news, research, analyses, prices and other information or links to third-party sites contained on this website are provided on an “as-is” basis, as general market commentary, and do not constitute investment advice. To the extent that any content is construed as investment research, you must note and accept that the content was not intended to and has not been prepared in accordance with legal requirements designed to promote the independence of investment research and as such, it would be considered as marketing communication under the relevant laws and regulations. Please ensure that you have read and understood our Notification on Non-Independent Investment. Research and Risk Warning concerning the foregoing information, which can be accessed here.
