U.S. stock futures moved higher on Wednesday, pointing to a rebound at the opening bell after the major indices declined in the previous session, as July inflation figures broadly matched economists’ expectations.
Futures strengthened following the Labor Department’s latest consumer price report, which showed prices rising 0.1% in July after declining 0.4% in June. The monthly increase was in line with forecasts.
Core consumer prices, excluding food and energy, advanced 0.2% during July after showing no change in June. That reading also matched market expectations.
Headline and core inflation rates ease
Annual headline inflation slowed slightly to 3.4% in July from 3.5% in June, while the annual core rate moderated to 2.5% from 2.6%.
Both readings were consistent with economists’ forecasts, potentially easing some concerns about persistent inflation and the implications for the Federal Reserve’s interest-rate policy.
Technology shares linked to artificial intelligence could provide additional momentum after investors responded positively to quarterly results and guidance from CoreWeave (NASDAQ:CRWV) and Super Micro Computer (NASDAQ:SMCI).
However, further gains in crude oil could temper risk appetite following deadly attacks involving vessels in the Red Sea and Gulf of Oman.
Major Wall Street indices declined on Tuesday
U.S. equities finished mostly lower on Tuesday after an uncertain start gave way to selling pressure later in the session, extending the modest declines recorded on Monday.
The Nasdaq fell 159.91 points, or 0.6%, to 26,445.45. The S&P 500 lost 24.91 points, or 0.3%, to close at 7,728.20, while the Dow Jones Industrial Average declined 184.13 points, or 0.3%, to 53,791.85.
Although all three benchmarks recovered from their intraday lows, they remained in negative territory at the closing bell.
Hormuz uncertainty keeps crude prices elevated
Oil prices contributed to Tuesday’s weaker market sentiment, with U.S. crude futures climbing more than 1% after surging by over 5% during Monday’s session.
The continued advance reflected uncertainty over whether the Strait of Hormuz could be reopened.
According to Reuters, Mohsen Rezaei, Secretary of Iran’s Supreme National Security Council, said the strategic waterway would remain closed until Tehran’s conditions were met.
The approaching release of Wednesday’s CPI figures also encouraged investors to remain cautious during the previous session.
Hardware and energy stocks buck broader decline
Computer hardware shares were among Tuesday’s strongest performers despite weakness across the wider equity market. The NYSE Arca Computer Hardware Index jumped 4.6%, reaching its highest closing level in two months.
Higher crude prices also lifted oil producers, pushing the NYSE Arca Oil Index up 2%.
Housing stocks recorded notable gains, while steel and retail shares were among the weaker areas of the market.
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