Futures Turn Negative Following Inflation Data

wallstreet sept17 11may22 lt

After moving higher earlier in the morning, the major U.S. stock futures have turned negative following the release of highly anticipated inflation data. The futures are currently pointing to a modestly lower open for the markets, with the S&P 500 futures down by 0.1 percent.

The downturn by the futures came after the Labor Department released a report showing the annual rate of consumer price growth slowed by less than expected.

While the report showed the annual rate of consumer price growth slowed to 8.3 percent in April from a 40-year high of 8.5 percent in March, economists had expected the pace of growth to slow to 8.1 percent.

The annual rate of growth in core consumer prices also slowed to 6.2 percent in April from 6.5 percent in March, although the rate was expected to decelerate to 6.0 percent.

On a monthly basis, the Labor Department said its consumer price index rose by 0.3 percent in April after surging by 1.2 percent in March. Economists had expected prices to edge up by 0.2 percent.

Core consumer prices, which exclude food and energy prices, climbed by 0.6 percent in April after rising by 0.3 percent in March. Core prices were expected to increase by 0.4 percent.

The data may add to recent concerns the Federal Reserve will raise interest rates more aggressively in an effort to bring inflation down at a faster rate.

Traders have recently expressed concerns more aggressive moves by the Fed and other central banks could lead to a period of stagflation or an outright recession.

After moving sharply lower for three straight sessions, stocks went on a rollercoaster ride over the course of the trading day on Tuesday. The major averages swung wildly back and forth across the unchanged line before ending the session mixed.

The tech-heavy Nasdaq jumped 114.42 points or 1 percent to 11,737.67 and the S&P 500 rose 9.81 points or 0.3 percent to 4,001.05, while the narrower Dow fell 84.96 points or 0.3 percent to 32,160.74, ending the session at its lowest closing level in over a year.

In overseas trading, stock markets across the Asia-Pacific region moved mostly higher during trading on Wednesday. Japan's Nikkei 225 Index edged up by 0.2 percent, while China's Shanghai Composite Index advanced by 0.8 percent.

The major European markets have also moved to the upside on the day. While the U.K.'s FTSE 100 Index has climbed by 0.8 percent, the French CAC 40 Index is up by 1.1 percent and the German DAX Index is up by 1.3 percent.

In commodities trading, crude oil futures are surging $3.83 to $103.59 a barrel after tumbling $3.33 to $99.76 a barrel on Tuesday. Meanwhile, an ounce of gold is trading at $1,844.60, up $3.60 compared to the previous session's close of $1,841. On Tuesday, gold slid $17.60.

On the currency front, the U.S. dollar is trading at 130.55 yen compared to the 130.45 yen it fetched at the close of New York trading on Tuesday. Against the euro, the dollar is trading at $1.0522 compared to yesterday's $1.0529.

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