Futures rise as Treasury yields drop ahead of inflation data

Futures rise as Treasury yields drop ahead of inflation data

(Reuters) – Futures for Wall Street’s main stock indexes rose on Thursday as Treasury yields eased, while investors looked forward to crucial inflation data to gauge the Federal Reserve’s interest-rate outlook. The Labor Department report, due at 8:30 a.m. ET, is expected to show consumer prices rising 0.3% in September according to economists polled by Reuters. Prices are seen rising to 3.6% in the 12 months through September.

The core figure, which excludes volatile food and energy prices, is expected to rise 0.3% last month. Meanwhile, the yield on the benchmark 10-year note fell for the third straight day, helping megacap stocks, including Apple (NASDAQ:AAPL), Alphabet (NASDAQ:GOOGL), Tesla (NASDAQ:TSLA), Nvidia (NASDAQ:NVDA), Meta Platforms (NASDAQ:META) and Amazon.com(NASDAQ:AMZN), advance between 0.2% and 0.6% in premarket trading.

Fed Bank of Boston President Susan Collins, who does not have a vote on the rate setting Federal Open Market Committee (FOMC) this year, said the economy was yet to feel the full impact of the rate hike cycle, while reiterating that the central bank is not done with rate hikes. Minutes from the Fed’s September policy meeting showed that policymakers were turning cautious due to the growing uncertainty around the path of the U.S. economy, as well as volatile data and tightening financial markets posing risks to growth. “The words ‘proceed carefully’ and ‘risks to achieving the goals had become more two-sided’ speak to the view of the centrists on the FOMC,” strategists at Societe Generale (OTC:SCGLY) said in a note.

“Barring a surprise for CPI today on the scale of non-farm payrolls last week, one must assume another hawkish pause or skip on Nov. 1 is now a done deal.” Traders put the chance of interest rates remaining unchanged in November and December at around 91% and around 72%, respectively, according to CME’s FedWatch tool. Meanwhile, Israel said there would be no humanitarian break to its siege of the Gaza Strip until all its hostages were freed. At 5:20 a.m. ET, Dow e-minis were up 99 points, or 0.29%, S&P 500 e-minis were up 15.25 points, or 0.35%, and Nasdaq 100 e-minis were up 52.75 points, or 0.34%. All three major U.S. stock indexes closed higher for the fourth straight session on Wednesday.

Quarterly earnings from fast food chain Domino’s Pizza (NYSE:DPZ), pharmacy chain operator Walgreens Boots Alliance (NASDAQ:WBA) and Delta Air Lines (NYSE:DAL) are due before the markets open. Ford Motor (NYSE:F) dipped 1.9% after United Auto Workers shut down the company’s biggest plant globally. Birkenstock Holding added 0.5% after the German sandal maker’s stock ended more than 12% below its initial public offering price on its market debut on Wednesday.

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