Market Analysis

U.S. stock index futures edged higher in evening trading on Thursday following a slightly negative session on Wall Street, driven by stronger-than-expected consumer inflation data.

Attention shifted to the upcoming third-quarter earnings season, set to kick off in earnest on Friday. Investors were also keenly awaiting Tesla’s much-anticipated robotaxi reveal.

By 19:10 ET (23:10 GMT), S&P 500 Futures were up 0.1% at 5,834.75 points, Nasdaq 100 Futures rose 0.1% to 20,453.50 points, and Dow Jones Futures gained 0.1% to 42,782.0 points.

Strong CPI Data Fuels Bets on Slower Rate Cuts
September's consumer price index (CPI) inflation came in higher than anticipated, easing but not by as much as analysts had expected. This prompted speculation that the Federal Reserve might slow its pace of interest rate cuts, with traders increasingly pricing in the likelihood of a 25 basis point cut in November.

Comments from Fed officials further supported this outlook. Atlanta Fed President Raphael Bostic noted that holding rates steady in November was also a possibility.

A slower pace of rate cuts could put pressure on U.S. stocks, as their record-high valuations have been partly driven by expectations of sharp interest rate reductions.

Investors are now looking ahead to producer price index (PPI) inflation data and a consumer sentiment reading due on Friday for further insight into the state of the economy.

However, expectations of a smaller rate cut were somewhat softened by higher-than-expected weekly jobless claims. Weakness in the labor market could keep the Fed on its easing path, limiting losses on Wall Street. Gains in large-cap technology stocks also helped cushion the market. The S&P 500 slipped 0.2% to 5,780.05 points, while the NASDAQ Composite remained flat at 18,283.90 points. The Dow Jones Industrial Average dipped 0.1% to 42,454.12 points.

Q3 Earnings Season and Tesla's Robotaxi Reveal
Investors are now focusing on third-quarter earnings, with major banks like JPMorgan Chase & Co (NYSE: JPM), Wells Fargo & Co (NYSE: WFC), and Bank of New York Mellon (NYSE: BK) set to report on Friday.

Other big names like Goldman Sachs Group Inc (NYSE: GS), Bank of America Corp (NYSE: BAC), and Citigroup Inc (NYSE: C) will release their earnings next week.

Tesla Inc. (NASDAQ: TSLA) traded steadily in after-hours action ahead of its scheduled robotaxi unveiling at 22:00 ET (02:00 GMT). This reveal is expected to showcase Tesla’s shift toward autonomous driving and AI, as the company navigates declining vehicle sales.

Paraphrasing text from "Investing" all rights reserved by the original author.