US futures up slightly following CPI print

European stocks and US equity futures made small advances as traders looked forward to more economic data that could reinforce the case for Federal Reserve interest-rate cuts.

Shares in Bavarian Nordic A/S, one of the few companies with an approved mpox vaccine, jumped 17% in Copenhagen after the World Health Organization declared a fast-spreading outbreak of the disease a global public health emergency. Europe’s Stoxx 600 Index rose 0.2%.

US futures pointed to a modestly positive open on Wall Street after the S&P 500 extended its winning streak to a fifth day Wednesday, buoyed by a benign consumer price index print. Cisco Systems Inc. rose as much as 7.4% in premarket after the computer networking equipment maker’s results beat expectations.

“The latest US inflation data supports our view of a gradual cooling of the US economy,” said Mark Haefele, chief investment officer at UBS Global Wealth Management. “This underlines our view that the Fed will start easing policy at its September meeting. That provides a positive backdrop for risk assets. It would also erode returns on cash, underlining our view that investors should brace for lower rates.”

There’s no let-up for traders tracking a busy week of updates on the world’s biggest economy. Thursday brings readings on initial jobless claims and retail sales, while Walmart Inc.’s earnings should provide insights into the state of the American consumer.

Figures out Wednesday showed that US year-on-year core consumer prices in July rose at the slowest pace since 2021. Traders are fully pricing in one 25 basis-point cut by the Fed next month and 100 basis points of reductions through year-end. 

Treasuries were steady, as was a gauge of dollar strength.

In Asia, Japan’s Topix index and China’s CSI 300 benchmark rose in a broadly positive reaction to data points in the two countries. Japan’s economy grew faster in the second quarter than analysts forecast. China, meanwhile, saw signs of stabilization that included slowing declines in home prices and better-than-expected retail sales.

Not everyone saw the latest China numbers positively.

The “July data suggest the government will have to provide more stimulus to meet its 5% economic growth target for the year,” Ed Yardeni, who runs Yardeni Research, wrote in a research note. “Most striking is the small but unusual decline in bank loans during the month. It suggests a lack of confidence among businesses and consumers, potentially leading to reduced investment and spending.”

In commodities, oil clawed back some gains after falling for a second session on Wednesday. Gold edged higher after two daily declines to trade above $2,450 per ounce.

Key events this week:

• US initial jobless claims, retail sales, industrial production, Thursday
• Fed’s Alberto Musalem and Patrick Harker speak, Thursday
• US housing starts, University of Michigan consumer sentiment, Friday
• Fed’s Austan Goolsbee speaks, Friday

Some of the main moves in markets:

Stocks

• The Stoxx Europe 600 rose 0.2% as of 9:36 a.m. London time
• S&P 500 futures were little changed
• Nasdaq 100 futures were little changed
• Futures on the Dow Jones Industrial Average rose 0.2%
• The MSCI Asia Pacific Index was little changed
• The MSCI Emerging Markets Index fell 0.2%

Currencies

• The Bloomberg Dollar Spot Index was little changed
• The euro was little changed at $1.1007
• The Japanese yen was little changed at 147.29 per dollar
• The offshore yuan fell 0.2% to 7.1607 per dollar
• The British pound rose 0.1% to $1.2846

Cryptocurrencies

• Bitcoin fell 1.5% to $58,294.34
• Ether fell 2.3% to $2,615.04

Bonds

• The yield on 10-year Treasuries was little changed at 3.84%
• Germany’s 10-year yield advanced two basis points to 2.20%
• Britain’s 10-year yield advanced three basis points to 3.85%

Commodities

• Brent crude rose 0.1% to $79.86 a barrel
• Spot gold rose 0.3% to $2,456.35 an ounce

This story was produced with the assistance of Bloomberg Automation.

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