Futures dip as caution prevails ahead of inflation data
For a Reuters live blog on U.S., UK and European stock markets, click LIVE/ or type LIVE/ in a news window.
Futures off: Dow 0.08%, S&P 500 0.17%, Nasdaq 0.33%
Nov 27 (Reuters) -U.S. stock index futures slipped on Wednesday as investors awaited key economic data, including a crucial inflation report, which is expected to influence the Federal Reserve's future monetary policy path.
The Personal Consumption Expenditure report, the central bank's preferred inflation data, is due at 10 a.m. ET. Economists polled by Reuters expect prices to increase by 2.3% on an annual basis in October, higher than the previous month's 2.1% rise and above the Fed's 2% target.
Minutes from the Fed's meeting earlier this month showed policymakers were uncertain about the outlook for interest-rate cuts and how much current rates were restricting the economy.
Traders are betting on a 66.3% probability the central bank will lower borrowing costs by 25 basis points in December, according to CME Group's FedWatch Tool. They are also pricing in roughly 75 bps worth of rate cuts by the end of 2025, down from about 250 bps in September, according to data compiled by LSEG.
Much of the worry has been that President-elect Donald Trump's proposed tax cuts and tariff policies, including his latest stand on imports from Mexico, Canada and China, could push prices up, spark a trade war and weigh on growth globally.
Deutsche Bank economists forecast such tariffs could lift U.S. core PCE inflation for 2025 from 2.6% to 3.7%, if fully implemented. Before Trump's victory, the expectation was for 2.3% inflation next year.
At 05:37 a.m. ET, Dow E-minis 1YMcv1 were down 34 points, or 0.08%, S&P 500 E-minis EScv1 were down 10 points, or 0.17%, and Nasdaq 100 E-minis NQcv1 were down 68.25 points, or 0.33%.
Futures tracking small caps RTYcv1 edged up 0.4%. Equities have rallied this year, with Wall Street's main indexes and the small-cap Russell index .RUT trading near record highs.
The benchmark S&P 500 is on track for its biggest one-month rise in a year and poised for its sixth month of gains out of seven, as markets price in the probability Trump's policies could benefit local businesses and the overall economy.
Investors will also monitor the second estimate for third-quarter gross domestic product, weekly jobless claims figures and October's durables goods data ahead of market open, all due at 8:30 a.m. ET.
Globally, nervousness prevailed as China's state media warned Trump's policy pledges earlier in the week could drag the world's top two economies into a mutually destructive tariff war.
Among top movers, Dell DELL.N slid 12.7% after issuing a weak quarterly revenue forecast and HP HPQ.N dropped 9% after a downbeat forecast for first-quarter profit, signaling lackluster demand in the personal computer market.
The sentiment spread to other tech names such as Nvidia NVDA.O, which fell 1.3%, Microsoft MSFT.O, off 0.6%, and Apple AAPL.O, which dropped 0.3%.
Workday WDAY.O lost 10% after forecasting fourth-quarter subscription revenue below expectations, hit by weaker client spending on its human capital management software.
Oil prices were steady as investors monitored the ceasefire between Israel and Lebanese armed group Hezbollah.
Reporting by Johann M Cherian in Bengaluru; Editing by Pooja Desai
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.
