By Tharuniyaa Lakshmi and Purvi Agarwal
Oct 14 (Reuters) – S&P 500 and Dow futures edged higher on Wednesday as AI-related stocks steadied after a recent selloff, though elevated oil prices kept investors on edge ahead of key inflation data and amid another round of big bank earnings.
Bank of America was down 4.2% in premarket trading after the lender’s profit fell in the third quarter as it set aside $1.2 billion to cover regulatory fines over failures to detect illicit activity. Morgan Stanley dipped marginally despite a rise in quarterly profit.
Asset manager BlackRock gained 4.9% after reporting a jump in third-quarter profit, helped by higher fees from managing client funds.
Banks including JPMorgan Chase and Goldman Sachs reported a mixed set of earnings on Monday that suggested a dealmaking and trading boom that powered record first-half earnings may be slowing, with executives pointing to the bond market rout weighing on activity.
Meanwhile, market participants were also awaiting US consumer price index data, due at 8.30 am ET, hoping for clues on the Federal Reserve’s interest-rate outlook.
Economists polled by Reuters estimate headline inflation accelerated to an annual 3.6% in September, with core CPI rising 0.2% on a monthly basis.
“While headline inflation in September could re-accelerate, we expect another solid set of corporate earnings and guidance from S&P 500 companies in the third-quarter reporting season,” analysts at UBS Global Wealth Management said in a note.
“Higher energy prices could be a headwind… But we think the impact on aggregate S&P 500 profits is limited,” they said.
Ahead of the CPI data, investors priced in a near 22% chance of a quarter-point US rate hike next week, the CME FedWatch Tool showed.
At 07:28 a.m. ET, Dow E-minis were up 141 points, or 0.27%, S&P 500 E-minis were up 11.5 points, or 0.15%, and Nasdaq 100 E-minis were down 50.75 points, or 0.16%.
Chip stocks traded slightly lower after a sharp pullback earlier this week sparked by reports of progress in chip design by China’s CXMT that fueled concerns about growing competition.
Shares of Intel and Micron fell 1.6% and 1.1%, respectively, while Nvidia slipped 0.6%.
Most “Magnificent Seven” stocks rose, with Alphabet gaining 1.3%, while Microsoft and Amazon.com were marginally higher.
New York Fed President John Williams said the Fed may need to raise its policy rate once more this year to slow inflation, but that he sees no need for hikes in 2027.
Remarks from Richmond Fed President Tom Barkin and the Fed’s Beige Book report on regional economic conditions are also due late in the day.
Oil prices edged higher on Wednesday, with Brent crude holding above the $100-a-barrel mark after two vessels were struck in the Strait of Hormuz and Iranian officials told Reuters they were deploying new tactics to target ships. [O/R]
Among individual movers, Liquidia jumped 47.6% after the drugmaker said it settled all six pending lawsuits with United Therapeutics, ensuring uninterrupted access to Yutrepia, a drug used to treat patients with a form of pulmonary hypertension.
(Reporting by Tharuniyaa Lakshmi and Purvi Agarwal in Bengaluru; Editing by Devika Syamnath)
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