US stock index futures traded flat on Tuesday ahead of the critical inflation report, which could be decisive for the Fed’s September interest rate decision. Markets are also pricing in the partial relief created by the US-China trade truce extended until November 10.
Data to be released by the US Department of Labor today at 15:30 GMT is expected to indicate moderate price increases in July. However, there is also a strong possibility that core inflation will show its highest increase in the last six months.
These results keep the probability of a 25 basis point interest rate cut by the Fed at 88%.Jim Reid from Deutsche Bank said, “This report is critical for the Fed following weak employment data,” emphasizing that expectations of an interest rate cut would strengthen with data below expectations.
On the stock market front, better-than-expected earnings reports from technology giants, easing of trade disputes, and expectations of interest rate cuts have pushed indices to record levels.
Highlights Among the rising stocks, Intel rose 3.3%, Palo Alto Networks rose 1.8%, and Hanesbrands rose 27.3%. On Holding shares gained 10.7% after raising its sales forecast.
