U.S. equity futures were little changed on Thursday morning as investors looked ahead to several economic reports scheduled to come out in the morning.
Futures tied to the Dow Jones Industrial Average inched higher by 26 points, or 0.08%. S&P 500 futures added 0.09%, and Nasdaq 100 futures ticked 0.06% higher.
Earlier in the day, the major averages ended a choppy session on a modestly higher note. The Dow closed slightly higher, by 30 points, after falling more than 200 points at one point. The S&P 500 rose 0.3%, and the Nasdaq Composite advanced 0.7%.
Stocks sought stability after a hotter-than-expected inflation report on Tuesday sent them tumbling to post their worst day since 2020. August’s consumer price index report showed headline inflation rose 0.1% on a monthly basis, despite a drop in gas prices.
“One-day events are tough to extrapolate,” said Jeff deGraaf, founder and chairman of Renaissance Macro Research, on CNBC’s “Closing Bell: Overtime.” “It is one of those extreme events that doesn’t have follow-through and that tends to be good news, not bad.”
“Inflation is really a dark cloud over equities, but I think it’s really important that people keep in mind that it’s not about good and bad in the markets, it’s about better and worse,” he added, “and it does appear that inflation is getting better.”
Wednesday’s producer price index report showed an decrease in wholesale prices of 0.1% in August, which deGraaf said provided him some comfort.
Investors are looking ahead to a raft of economic updates on Thursday morning, including retail sales, import prices and jobless claims, as well as the Philadelphia Fed manufacturing survey and the Empire State manufacturing survey – all at 8:30 a.m. ET.
CNBC Pro: Morgan Stanley says the S&P 500 is set for a comeback by year-end. These are its top stock picks
U.S. markets had a meltdown on Tuesday — the worst since June 2020 — following yet another hot inflation report. But that may not last for long, according to Andrew Slimmon of Morgan Stanley Investment Management, who says the S&P 500 could enjoy upside by year-end.
He predicts the level that the S&P 500 will rise to by the year end, and also picks stocks to buy into the “fear.”
— Weizhen Tan
U.S. 2-year Treasury yields hits 3.8% again
Inflation isn’t as bad as the data makes it seem, says Commonwealth’s McMillan
This week’s CPI data was “terrible,” but there are signs some key components may improve shortly, according to Brad McMillan, chief investment officer at Commonwealth Financial Network. One of them is Wednesday’s producer price index report.
“The headline number held steady at 0.2 percent, but the annual number dropped by much more, from 9.8 percent to 8.7 percent (a much bigger drop than the CPI),” he said. “Similarly, for the core PPI, while there was a gain from 0.2 percent to 0.4 percent, the annual number was down as well, from 7.6 percent to 7.3 percent. That’s still too high, but even if that monthly 0.4 percent figure held, there would be a decline in inflation going forward.”
“As always, markets have reacted to a headline—although not about the headline number. But when you look at the details, things are not so bad,” he added. “The CPI and the market reaction suggest inflation will keep rising at an accelerating rate, but not all of the data agree. Even using much of the data as it stands, it still looks likely inflation will end the year lower than it is now.”
— Tanaya Macheel
Danaher was one of the top stock movers in extended trading Wednesday evening after the medical company announced plans to spin off its environmental and applied solutions business to create an independent, publicly traded company. Its shares rose about 4%.
Danaher also raised its third-quarter revenue guidance, according to FactSet.
— Tanaya Macheel
Stock futures open slightly higher
Dow Jones Industrial Average futures opened 33 points, or 0.11%, higher Wednesday night. S&P 500 futures added 0.15%, while Nasdaq 100 futures advanced 0.14%.
The moves came after all of the major averages ended a choppy trading day modestly higher.
— Tanaya Macheel