Futures point to more gains on Wall St as inflation eases
(Reuters) — U.S. stock index futures edged higher on Thursday following a sharp rally on Wall Street in the previous session as data showed inflation was cooling, with investors looking ahead to producer price data due later in the day.
A slower rise in prices has boosted hopes that the Federal Reserve could soon end its monetary tightening campaign.
Economists polled by Reuters expect producer inflation to have eased to 0.4% over the 12 months through June from 1.1% in the previous month. The data is due at 8:30 a.m. ET.
On Wednesday, the Nasdaq and the S&P 500 closed at over a year's high, with megacap stocks leading gains after the CPI report showed consumer prices registered their smallest annual increase in more than two years.
Traders have cemented bets of a 25-basis-point rate hike later in July, but have toned down possibilities of another rate hike this year, with yield on the two-year treasury note hitting their lowest in nearly four weeks. [US/]
«Today's PPI numbers for June are expected to reinforce the disinflation trends being seen rippling out through the global economy,» Michael Hewson, chief market analyst at CMC Markets wrote in a note.
«But more importantly (it will) signal that U.S. rate hikes are done, bar the move in two weeks' time.»
Second-quarter earnings from PepsiCo (NASDAQ:PEP) and Delta Air lines will also be in focus as investors assess the impact of monetary tightening on corporate performance. The Atlanta Georgia-based airline edged up 1.0% in premarket trading.
Overall, earnings for the S&P 500 constituents are expected to have dropped 6.4% in the second quarter, Refintiv data showed.
At 5:27 a.m. ET, Dow e-minis were up 88 points, or 0.25%, S&P 500 e-minis were up 16.75 points, or 0.37%,
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