U.S. stock futures inch up as JPMorgan kicks off earnings, consumer price inflation data ahead

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MARKET SNAPSHOT

U.S. stock index futures inched up on Wednesday, with corporate earnings reports rolling in from JPMorgan Chase and Delta Airlines while investors await the September consumer price index.

How are stock-index futures trading?

  • Dow Jones Industrial Average futures rose less than a percent to 34,282
  • S&P 500 futures were flat at 4,345
  • Nasdaq-100 futures rose 0.3% to 14,697

On Tuesday, the Dow Jones Industrial Average fell 118 points, or 0.34%, to 34378, the S&P 500 declined 11 points, or 0.24%, to 4351, and the Nasdaq Composite dropped 20 points, or 0.14%, to 14466.

What’s driving the market?

Stock markets have seen choppy action this week have investors have anxiously awaited the start of third-quarter U.S. corporate earnings reporting season, amid concerns supply-chain problems and labor shortages have dented profit margins.

Shares of tech giant Apple fell 0.7% in premarket trading, after Bloomberg reported late Tuesday that the tech giant will cut iPhone 13 production due to global chip supply shortages.

The start of the U.S. earnings reporting season was underway, with JPMorgan Chase beating Wall Street forecasts on earnings per share as it released another $2.1 billion of loan loss reserves. Those shares rose 0.5% in premarket. BlackRock shares climbed 2% after the bank reported beats on both profit and revenue expectations and more than 20% growth on assets undermangement.

Analysts expect S&P 500 index earnings to rise 27.6% annually, a pace markedly slower than a 52.8% gain in the first quarter and 92.4% in the second quarter, which both benefited from favorable comparisons with the start of the COVID-19 pandemic last year. Bank of America has warned that guidance from companies could be ugly amid a “make or break quarter.”

Read: Will bank stocks’ wild rally continue? Here are the numbers to watch in this week’s earnings

Opinion: Beating the market would still be tough even if you knew the S&P 500’s earnings before everyone else

September U.S. consumer prices are also in the spotlight for Tuesday, with economists forecasting that the monthly number will rise 0.3%, and the annual number steady stable at 5.3%. The numbers are due at 8:30 a.m. Eastern Time.

The CPI data will show how a 13% rally in U.S. crude prices has hit inflation, with chances of a stronger number more likely than a softer one, said Ipek Ozkardeskaya, senior analyst at Swissquote, in a note to clients.

“And a strong inflation [number] will only reinforce the expectation that the Federal Reserve (Fed) would start tapering its bond purchases by next month, that’s already priced in. Yet, a too strong figure could boost expectations of an earlier rate hike from the Fed, and that’s not necessarily fully priced in,” said the analyst.

Later on Wednesday, investors will get the latest Federal Open Market Committee meeting minutes. That could “reiterate the Fed’s willingness to start tapering the bond purchases soon and could give a further insight regarding the need and the possibility of seeing the rate normalization happen before 2023,” said Ozkardeskaya.

What companies are in focus?

  • Shares of Qualcomm Inc. rose 1.8% in premarket trading after the chip maker said its board had authorized $10 billion in share repurchases
  • Shares of Delta Air Lines Inc.  fell 1.2% in premarket trading after the air carrier reported its first adjusted profit since the COVID-19 pandemic, but said the recent rise in fuel prices will pressure its ability to stay profitable in the fourth quarter.

How are other assets trading?

  • The yield on the 10-year U.S. Treasury note slipped 1 basis point to 1.5666%. Yields and debt prices move in opposite directions.
  • The ICE U.S. Dollar Index a measure of the currency against a basket of six major rivals,fell 0.2%.
  • U.S. oil futures were lower, with the benchmark down 0.8% at $82.72 a barrel. Gold futures rose 0.8% to $1,774.50 an ounce.
  • The Stoxx Europe 600 rose 0.4%, while London’s FTSE 100 fell 0.1%.
  • The Shanghai Composite rose 0.4%, while Japan’s Nikkei 225 lost 0.3%.
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