Futures flat as big banks fall after earnings; inflation data awaited
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PPI due at 8:30 a.m. ET
JPMorgan profit jumps; shares down in choppy trading
Wells Fargo drops after profit falls on deposit costs
BNY up after Q2 profit rises on investment service fee boost
Futures: Dow up 0.04%, S&P up 0.03%, Nasdaq down 0.06%
Updated at 6:54 a.m. ET/1054 GMT
By Medha Singh and Ankika Biswas
July 12 (Reuters) - U.S. index futures struggled for direction on Friday as investors parsed a set of big bank earnings to gauge the health of corporate America, while awaiting key inflation data for clues on the timing of interest rate cuts.
JPMorgan Chase's JPM.N second-quarter profit rose on a boost from rising investment banking fees and an $8 billion accounting gain from a share exchange deal with Visa V.N. However, shares of the world's largest bank were last down 1.1% in volatile premarket trading.
Wells Fargo WFC.N dropped5.1% aftersecond-quarter profit declined as the lender shelled out more to hold on to deposits, amid intense competition for customers' money.
The results come against the backdrop of expectations of some of the largest U.S. banks witnessing weaker second-quarter profits due to lower interest payments and higher provisions to cover deteriorating loans.
Citigroup C.N was alsodown 0.4% ahead of its results before the opening bell.
As the S&P 500 .SPX and Nasdaq .IXIC scale new peaks, investors are hoping for strong profit growth from companies beyond the heavyweight tech names such as Nvidia NVDA.O, so that the U.S. stocks rally can broaden out.
A rotation out of high-flying large-cap stocks in favor of small-cap shares knocked down the tech-laden Nasdaq by nearly 2% on Thursday after a surprise fall in U.S. consumer prices solidified bets of a September interest rate cut.
"This CPI report came one day after Federal Reserve Chairman Powell concluded the double testimony in Congress, where he kept the cards close to his chest and decided to please Fed members with both hawkish and dovish comments," Achilleas Georgolopoulos, investment analyst at forex broker XM said in a note.
"However, with the clock now counting down to the month-end gathering, the doves will probably push for a dovish stance on July 31."
Investors will watch for the Producer Price Index report, due at 8:30 a.m. ET, for further evidence of moderating price pressures.
The PPI reading for June is expected to rise 2.3% annually, compared to a 2.2% rise in May. Excluding volatile food and energy components, the so-called core figure likely advanced 2.5% following May's 2.3% rise.
Traders now see a 92% chance of a rate cut in September, up from 77.7% a week ago, according to CME Group's FedWatch Tool.
Among other data points, theUniversity of Michigan's consumer survey is also due after markets open.
At 6:54 a.m. ET, Dow e-minis 1YMcv1 were up 17 points, or 0.04%, S&P 500 e-minis EScv1 were up 1.75 points, or 0.03%, and Nasdaq 100 e-minis NQcv1 were down 13.25 points, or 0.06%.
Tesla TSLA.Odropped 2% after UBS downgraded the EV maker's stock to "sell" from "neutral".
BNY BK.Nclimbed 2.3% after the U.S. bank posted a 10% rise insecond-quarter net profit on Friday.
AT&T T.Ndropped 2.7% after the telecom firm said data from about 109 million customer accounts containing records of calls and texts from 2022 wasillegally downloaded in April.
Reporting by Medha Singh and Ankika Biswas in Bengaluru; Editing by Saumyadeb Chakrabarty and Pooja Desai
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