U.S. stock futures moved higher in pre-market trading after a morning packed with economic releases and second-quarter results. The Dow, S&P 500, Nasdaq and Russell 2000 were all pointed up, with the biggest gains showing in the Nasdaq, as investors reacted to a softer inflation reading and a fresh batch of corporate earnings.
The Producer Price Index for June came in below expectations, with headline wholesale inflation falling 0.3% from the prior month. That was weaker than the flat reading economists had expected and marked the sharpest monthly drop since August of last year. The prior month’s result was also revised lower. On a year-over-year basis, PPI eased to 5.5%, while core PPI, which strips out food and energy, rose 0.2% for the month and 4.7% from a year earlier. According to the report, lower oil prices were a major factor behind the decline, with energy prices down 6.4% and diesel off 18% at the wholesale level. Goods prices fell 1.4% and food prices declined 0.6%.
The report also noted that inflation measures have been helped by easing oil prices, following the opening of the Strait of Hormuz last month. Still, that relief could prove temporary, given renewed concerns in the Middle East. Even so, the softer PPI data added to the more encouraging tone set by Tuesday’s consumer inflation figures, which also suggested pressure on the economy was easing.
Investors were also watching second-quarter earnings. Morgan Stanley reported before the opening bell and delivered results that topped expectations on both revenue and profit. The bank earned $3.46 per share, ahead of the $2.89 consensus estimate. More quarterly results were due later in the day, including BlackRock’s report, keeping attention on how companies are navigating the current economic backdrop.
Source: nasdaq.com
