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US Stock Futures Rise Amid Inflation Data And Impending Fed Minutes

Student Loan Repayment
Student Loan Repayment; Source- CNBC

Wednesday saw a rise in U.S. stock futures as investors put their concerns over the Middle East war on hold and expressed optimism that the Federal Reserve would soon stop rising interest rates. The story could be advanced by the latest Fed meeting minutes and inflation figures.

Dow Jones Industrial Average futures increased by 110 points, or 0.3%, following the index’s 134-point gain on Tuesday, which saw it close at 33,739 points. S&P 500 futures increased by 0.3%, matching the 0.4% increase in the tech-heavy Nasdaq.

Increasing Intrest Rates

With investors continuing to look past geopolitical threats from Israel’s declaration of war on Hamas following dramatic violence from Gaza over the weekend, the main indices were headed for their fourth straight day of gains. A decline in bond yields that has boosted stock prices has caused the focus of the story to return to interest rates and inflation, two topics that have dominated for months.

Jim Reid, a strategist at Deutsche Bank, stated that “markets have surged so far this week despite the ongoing geopolitical turmoil.” “Global markets rise on stabilisation in crude oil prices and easing concerns about U.S. interest rates.”

Bond yields have dropped from their recent peak thanks to a dovish shift in expectations for future rate increases, which has also eased some of the pressure on stocks. Wednesday saw another decline in the benchmark 10-year U.S. Treasury yield, which had been trading close to 4.8% before the weekend—its highest level since 2007.

Investor attention is currently on producer-price index (PPI) inflation data and the minutes from the most recent Fed meeting, which both have the potential to influence interest rate expectations in the next day.

Inflation

 inflation

Source: ABC news

Because investors are so data-sensitive, any indication that U.S. inflation is bucking down from its current trend would be worrisome and might derail expectations of a more dovish approach from the Fed, according to Susannah.

Additional remarks from Fed officials will also be highlighted, such as those anticipated from Fed Governor Christopher Waller, Fed President Raphael Bostic of Atlanta, and Fed President Susan Collins of Boston.

“This week’s rally can continue if the [Fed] minutes and Fed chatter throughout the day continue to support the less-hawkish narrative of recent,” stated Tom Essaye, the founder of Sevens Report Research.

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