Dow Futures Rise Slightly, Inflation Data on Tap — and What Else Is Happening in the Stock Market Today

Traders working at the New York Stock Exchange (Photo courtesy of NYSE)

Stock futures fluctuated Wednesday as Wall Street geared up for the release of U.S. inflation data that could provide investors with a clearer idea on how aggressive the Federal Reserve will be in its efforts to curb rising prices.

Contracts linked to the


Dow Jones Industrial Average

rose 21 points, or 0.06%, to 32,758,


S&P 500

futures were up 0.02% while


Nasdaq

futures slipped 0.07%. 

Stocks declined Tuesday with tech shares falling the most after



Micron Technology

(ticker: MU) became the latest chip maker to issue a revenue warning because of weaker demand. The S&P 500 declined for a fourth straight session.

The consumer price index, to be released Wednesday before U.S stock markets open for trading, is expected to have decelerated sharply in July. Economists surveyed by FactSet expect CPI to have risen 0.2% over the month and to have slowed to an 8.7% annual pace. That would be down from June’s 1.3% monthly pace and 9.1% annual rate.

Core CPI, which strips out volatile food and energy costs, is forecast by economists to haven risen to an annual rate of 6.1% in July, up from 5.9% in June.

“I don’t think it’s an exaggeration to say that today’s inflation number could set the tone for the markets for the rest of the month,” said Craig Erlam, senior market analyst at Oanda.

Erlam said a lower-than-expected inflation reading could be a “major tailwind for the markets” while anything around or above the June reading “could trigger a big risk reversal in the markets” and renew the debate on whether the Fed will boost rates another 0.75 percentage point or a full point.

The U.S. central bank in late July raised rates by 0.75 percentage point for the second consecutive time, lifting its benchmark rate to a range of 2.25%-2.5%. It has boosted interest rates four times this year as it grapples with inflation at 41-year highs.

Elsewhere,



Tesla

(ticker: TSLA) Chief Executive Elon Musk disclosed he sold $6.9 billion of stock in his electric-vehicle company over the past three trading days. Musk said in a tweet that in “the (hopefully unlikely) event that



Twitter

forces this deal to close *and* some equity partners don’t come through, it is important to avoid an emergency sale of



Tesla

stock.”

Musk has been trying to terminate the agreement he reached in April to buy



Twitter

(TWTR), while the social media company has been trying to enforce the purchase in court.

Write to Joe Woelfel at joseph.woelfel@barrons.com

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