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Consumer price report has traders bracing for inflation data

US stock futures were mixed early Wednesday, after Federal Reserve Chairman Jerome Powell said monetary policy will return to normal and interest rates may be raised earlier than planned.

Major futures indexes suggested slight gains in the Dow and a 0.2% decline in the Nasdaq.

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Wall Street’s benchmark S&P 500 index rose 0.9% after Powell said policy “in all likelihood” will return to normal as bond purchases and other economic stimulus fall. Speaking before the Senate Banking Committee, he said ultra-low interest rates may be raised earlier than planned if needed to cool inflation that is at its highest levels in four decades.

Traders will turn their eyes to the key economic report on inflation.

Powell overinflated, Jobs in confirmation hearing, despite bipartisan support for the Federal Reserve

The Bureau of Labor Statistics is expected to say that the Consumer Price Index rose 0.4% month over month in December. That would be half of November’s 0.8% gain. On an annual basis, watch for a 7.0% price increase. This would be the highest inflation in nearly 40 years and up from 6.8% in November.

If you factor in volatile food and energy costs, core CPI likely rose 0.5% last month, in line with November’s increase. On an annual basis, core CPI is expected to jump 5.4% in December. This is up from 4.9% in November and will mark the fastest growth in more than 30 years.

In Europe, London’s FTSE rose 0.5%, Germany’s DAX rose 0.7%, and France’s CAC rose 0.7%.

In Asia, Tokyo’s Nikkei 225 rose 1.9%, Hong Kong’s Hang Seng rose 2.7%, and China’s Shanghai Composite rose 0.8%.

ribbon protection the last change % changes
Me: DJI Dow Jones averages 36252.02.0000 +183.15 + 0.51%
SP500 Standard & Poor’s 500 4713.07 +42.78 + 0.92%
I: COMP Nasdaq Composite Index 15153.448663 +210.62 + 1.41%

On Tuesday, the S&P 500 broke a five-day streak of declines and rose to 4,713.07. The Dow Jones Industrial Average rose 0.5% to 36252.02. The Nasdaq Composite advanced 1.4% to 15153.45.

Apple shares rose 1.7 percent and chip maker Nvidia rose 1.5 percent. Telecom stocks and a mix of retailers and other companies that rely on direct consumer spending rose. Facebook’s parent Meta Platform gained 1.9% and the gap increased 3%.

Biogen shares are trading 9% lower in the primary market after Medicare announced Tuesday that it will limit coverage of its Alzheimer’s drug to $28,000 per year only for patients taking the drug as part of clinical trials.

Dish Network shares rose more than 6% in the primary market after the New York Post reported that DirecTV and Dish Network again holding talks about a potential merger.

Gas prices rise as oil remains ‘disturbingly strong’

The World Bank cut its forecast for global economic growth this year to 4.1% from 4.3% due in part to supply chain disruptions that have fueled inflation. The agency estimates that the global economy grew by 5.5% in 2021.

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In energy markets, US crude rose 42 cents to $81.65 a barrel in electronic trading on the New York Mercantile Exchange. The contract rose $2.99 ​​on Tuesday to $81.22. Brent crude, used as the basis for the global oil price, rose 28 cents to $84.00 a barrel in London. It gained $2.85 in the previous session to $83.72.

The Associated Press contributed to this report.

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