Stock futures were flat early Wednesday as Wall Street braced for November’s key inflation report and the start of the Federal Reserve December policy meeting.
Futures tied to the Dow Jones Industrial Average inched 0.01% lower, while futures connected to the S&P 500 and Nasdaq 100 traded flat, declining 0.08% and 0.14% respectively.
Oracle shares gained nearly 2% after hours on strong quarterly results.
Investors are waiting for the discharge of November’s consumer price index report, and hoping for signs of easing inflation. Economists surveyed by Dow Jones expect a 0.3% increase on a monthly basis or an annual pace of seven.3%. That may be a step down from October’s 0.4% monthly increase and annual gain of seven.7%.
Tuesday’s inflation report could play a key role within the Federal Reserve’s next rate-hiking decision expected on the conclusion of its two-day policy meeting on Wednesday.
Traders are largely pricing in a 50 basis point increase, a slight decline from the previous 4 hikes. They can even monitor updated economic projections and commentary out of Chair Jerome Powell’s press conference for signs of a possible policy pivot as fears of a recession linger on Wall Street.
Monday’s overnight moves follow a solid session for all the main averages after a tricky down week. The Dow gained greater than 528 points, or 1.58%, while the S&P and Nasdaq rose 1.43% and 1.26%, respectively.
All major S&P 500 sectors finished with gains, led to the upside by energy stocks, which rose as oil prices gained.
“I believe this can be a reflection of what is anticipated out of the CPI number tomorrow, and a hope that the Fed will confirm a 50 basis point raise on Wednesday,” said Kevin Philip, partner at Bel Air Investment Advisors. “I believe the market, because it’s done before, is banking, for my part, a bit too heavily on some kind of Fed pivot and this bounce we got today is fragile at best.”
