Technology and artificial intelligence-linked stocks helped lift the market, with the S&P 500 and Nasdaq advancing while the Dow Jones Industrial Average remained largely flat.
The S&P 500 rose 0.3%, while the Nasdaq Composite gained 0.7%. The Dow was up about 24 points, or 0.1%, in early trading. AI-related names including CoreWeave and Super Micro Computer were among the stocks supporting the tech-heavy Nasdaq.
July’s consumer price index rose 0.1% month-on-month, while the annual inflation rate stood at 3.4%. Core CPI, which excludes food and energy, increased 0.2% from the previous month and 2.5% from a year earlier. Both the headline and core annual inflation rates eased slightly from June.
The data reinforced expectations that the Federal Reserve could keep interest rates unchanged at its September meeting. As cited by CNBC, Ellen Zentner, chief economic strategist at Morgan Stanley Wealth Management, said the in-line inflation reading keeps the “no need to hike rates” narrative intact following last week’s jobs report. She added that another inflation reading before the September FOMC meeting could still change the outlook, but absent a significant surprise, the Fed is likely to leave rates unchanged next month.
US stock futures rise as investors await crucial July CPI report
US stock futures edged higher on Wednesday, August 12, as investors turned their attention to the latest Consumer Price Index (CPI) report, a key data point that could influence the Federal Reserve’s outlook on interest rates.
S&P 500 futures rose 0.3%, while Nasdaq-100 futures gained 0.7%. Dow Jones Industrial Average futures were up 78 points, or 0.1%, in premarket trading.
The relatively subdued moves came as markets awaited July’s inflation reading, due at 8:30 am ET. Economists expect the Consumer Price Index to rise 3.4% year on year in July, slowing from a 3.5% increase in June, while monthly CPI is forecast to rise 0.1%, Yahoo Finance reported.
Core CPI, which excludes food and energy prices, is expected to rise 0.2% from the previous month, according to economists polled by Dow Jones.
The inflation data will be closely watched after a softer-than-expected July jobs report, with investors assessing what the latest figures could mean for the Fed’s interest-rate path.
In premarket trading, CoreWeave shares jumped 18% after the cloud infrastructure company reported a second-quarter adjusted operating income margin of 5%, beating expectations.
Super Micro Computer shares also climbed 9% ahead of the opening bell following a strong quarterly earnings and revenue update. US-listed shares of Dutch cloud infrastructure company Nebius Group gained more than 8%.
The gains in technology and cloud infrastructure stocks provided some support to the broader market ahead of the inflation release.
On the earnings front, investors are also awaiting results from companies including Cisco Systems, Coherent Corp, Nebius Group and Cerebras Systems.
With earnings season nearing its end, Wednesday’s CPI report is likely to remain the main focus for markets as investors look for clues on the direction of interest rates and the broader US economy.
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