U.S. stock futures were mostly rising Thursday after a surprise cooldown in a key inflation measure appeared to boost the chances that the Federal Reserve will cut interest rates at some point this year.
Core consumer price inflation, which doesn’t include volatile food and energy prices, rose 0.2% last month for its smallest gain since July, the Bureau of Labor Statistics said Wednesday. Economists had been expecting a 0.3% rise.
The news eased the market’s nerves after a so-so start to 2025 that’s been defined by worries about elevated interest rates and a tick-up in bond yields, driving stocks to their best session since Donald Trump won the presidential election.
“Wherever you were around the world yesterday, I’m sure you could hear the huge collective sigh of relief from financial markets,” Deutsche Bank analyst Jim Reid said, adding that the cooldown in inflation “allowed us to step back from the recent one-way trade on inflation and bond yields.”
The blue-chip U.S. indexes were looking for further gains Thursday. Futures tracking the Dow Jones Industrial Average were falling 91 points, or 0.2%. S&P 500 futures climbed 0.1% and contracts tied to the Nasdaq 100 rose 0.3%.
Earnings are likely to be the session’s key story, with Wall Street giants Bank of America and Morgan Stanley both set to report. Strong results by JPMorgan Chase and several other big banks have already put investors in a good mood.
Bond yields edged up slightly, having retreated Wednesday. The yield on the 10-year U.S. Treasury note ticked up 1 basis point to 4.669%, and the yield on the 2-year note was up 4 basis points to 4.302%