Stock futures struggle for direction ahead of inflation data


U.S. stock-index futures point to a flat to slightly higher start for Wall Street Wednesday, a day ahead of an eagerly awaited inflation report.

What are major benchmarks doing?
  • Futures on the Dow Jones Industrial Average
    fell 65 points, or 0.2%, to 34,521.

  • S&P 500 futures
    were off 0.80 point at 4,225.

  • Nasdaq-100 futures
    rose 24.75 points, or 0.2%, to 13,836.25.

On Tuesday, stocks barely budged. The Dow
fell 30.42 points, or 0.1%, to close at 34,599.82, while the S&P 500
rose less than a full point and the Nasdaq Composite
edged up 0.3%.

Read: Why stock traders say ‘never short a dull market’

What’s driving the market?

Equities remain stuck in a trading range, with the S&P 500 and Dow hovering near all-time highs.

“Since May 27, we have managed to gap higher six times, with only one time leading to a higher close on June 4, jobs Friday,” said Michael Kramer, chief executive at Mott Capital Management, in a note.

“The rest of the time, we basically finished the day flat. It suggests that buyers have enough energy to open the market higher, but not enough to finish the job, allowing the sellers to take over. I’m just wondering at what point this pattern breaks and what the result will be,” Kramer wrote.

A May reading of the consumer-price index due on Thursday morning is expected to be the main event of the week. A hotter-than-expected April CPI reading, which showed prices rose 4.2% year-over-year, briefly rattled markets last month.

Since then, inflation jitters have appeared to wane, but the CPI data is expected to provide an important test.

Economic Preview: U.S. inflation is still climbing and now higher labor costs are adding to the pressure

Prices of goods leaving Chinese factories in May rose at their highest pace in nearly 13 years, boosted by a surge in global commodity prices. China’s producer-price index jumped 9.0% from a year ago in May, accelerating from April’s 6.8% increase, the country’s National Bureau of Statistics said Wednesday.

Talks between the White House and a group of Republican senators led by West Virginia’s Shelley Moore Capito on an infrastructure package broke down Tuesday, though President Joe Biden is still aiming to reach a deal on the issue with a different group that includes Republican senators.

The U.S. economic calendar is light Wednesday, featuring April wholesale inventories at 10 a.m. Eastern.

Which companies are in focus?
  • Target Corp.
    said Wednesday it wold raise its quarterly dividend by 32.4%, to 90 cents a share from 68 cents. Shares of the discount retailer were up 0.3% in premarket trade.

  • Marqeta Inc. priced its initial public offering at $27 a share late Tuesday, well above its expected range. Marqeta shares are scheduled to begin trading Wednesday on the Nasdaq under the ticker “MQ.”

  • Shares of Clover Health Investments Corp.
    were up more than 24% in premarket trade Wednesday, after an 85% pop on Tuesday as it joined the ranks of meme stocks at the center of a speculative frenzy by individual investors.

  • Shares of United Parcel Service Inc.
    were off 0.1% after the package delivery giant laid out financial targets for 2023, and provided long-term ESG targets. 

  • Campbell Soup Co.
    shares fell more than 7% after the food company on Wednesday reported earnings and revenue that came in below Wall Street estimates and cut its fiscal 2021 outlook.

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