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Dow Futures Rise 125 Pts; U.S. CPI Firmly in Focus

Stock Markets1 hour ago (Dec 10, 2021 12:22)

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By Peter Nurse – U.S. stocks are seen nudging higher at the open Friday, with investors waiting for the latest U.S. inflation reading with bated breath.

At 7 AM ET (1200 GMT), the Dow Futures contract was up 125 points, or 0.4%, S&P 500 Futures traded 20 points, or 0.5%, higher and Nasdaq 100 Futures climbed 70 points, or 0.4%.

The major averages handed back some of their hefty gains this week on Thursday, snapping a three-day win streak, with blue chip Dow Jones Industrial Average dropping less than one point, the broad-based S&P 500 down 0.7% and the tech-heavy Nasdaq Composite falling 1.7%.

The discovery of the Omicron strain of the Covid-19 has added volatility into the markets since it was first identified by scientists in South Africa last month. However, the main focus Friday will be the release of the latest U.S. inflation data, at 8:30 AM ET (1230 GMT), as a precursor to next week’s Federal Reserve policy-setting meeting.

U.S. consumer prices are expected to have jumped by 6.8% year-on-year in November, topping October’s 6.2% rise which was the biggest inflation surge in more than 30 years.

A higher than expected number could convince the Fed it needs to act more aggressively. It is already expected to announce that it will speed up the tapering of its bond-buying program next week.

Also due later in the session is the preliminary reading of the University of Michigan’s Consumer Sentiment Index, which is seen weakening to 67.1 from November’s 67.4. 

In the corporate sector, Lululemon Athletica (NASDAQ:LULU) is likely to be in the spotlight after the athleisurewear retailer boosted its annual sales growth outlook but also warned of a potential hit to demand from the new variants of the coronavirus.

Oracle (NYSE:ORCL) will also be in focus after the computer software company posted strong second-quarter results as well as increasing its ongoing share buyback program by an additional $10 billion.

Oil prices pushed higher, and are on course for their biggest weekly gain since late August as fears that the Omicron variant will lead to a significant hit to global crude demand dissipate.

By 7 AM ET, U.S. crude futures traded 1% higher at $71.66 a barrel, while the Brent contract rose 0.9% to $75.09. Both benchmarks are set to rise more than 7% this week, their first weekly gain in seven weeks.

Data detailing the Baker Hughes‘ rig count and CFTC positioning later in the session round off the week.

Additionally, gold futures fell 0.2% to $1,772.45/oz, while EUR/USD fell 0.2% to 1.1270.

Dow Futures Rise 125 Pts; U.S. CPI Firmly in Focus

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