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U.S. equity futures edged higher Thursday, while Treasury yields and the dollar steadied, as investors prepped for a key inflation reading prior to the start of trading. Fourth-quarter-earnings season kicks off to close out the week.
Stocks look poised for a sharp reaction to today’s December consumer-price report, which is expected to show a modest uptick in headline price pressure but another downturn in the core reading, which strips out food and energy components.
The Federal Reserve has said it tracks core inflation pressures as part of its price-stability mandate, and the year-on-year gains remain nearly double its preferred target of 2%.
New York Fed President John Williams, in fact, told an event in the city last night that he and his colleagues need to see more data in order to find conviction that inflation is in full retreat.
“I expect that we will need to maintain a restrictive stance of policy for some time to fully achieve our goals, and it will only be appropriate to dial back the degree of policy restraint when we are confident that inflation is moving toward 2% on a sustained basis,” he said.
Benchmark 10-year Treasury bond yields slipped below 4% in overnight dealing ahead of today’s inflation print, helped in part by a solid, but by no means spectacular, auction of $37 billion in new paper on Wednesday.
The Treasury will also auction another $21 billion in 30-year bonds later today, wrapping up a full week of $108 billion in coupon sales.
The U.S. dollar index, meanwhile, was marked 0.12% lower against a basket of its global peers at 102.238 heading into the start of trading in New York.
Bitcoin prices were also in focus after the Securities and Exchange Commission confirmed its approval for listings of around a dozen exchange traded funds that will directly hold the world’s biggest cryptocurrency.
Around a dozen companies, including Franklin Templeton, Fidelity, Ark21, a unit of Cathie Wood’s Ark Investment, WisdomTree and Invesco all had filed requests with the SEC for approval to list their individual ETFs.
Depending on customer demand, the bitcoin purchases required to match the money invested in each ETF should provide a significant boost to overall bitcoin prices, as well as to other digital assets in the global cryptocurrency market.
Bitcoin prices were marked around 1% higher on the session following the SEC decision and were changing hands at $47,127 each, extending a surge of around 70% since mid-October.
On Wall Street, stock futures tied to the S&P 500, which is down 0.28% for the year, are indicating a 3 point opening-bell gain while those linked to the Dow Jones Industrial Average are indicating a 23 point dip
The tech-focused Nasdaq, meanwhile, is called 65 points higher and could edge into positive territory for the year at the start of trading.
In overseas markets, Japan’s Nikkei 225 extended its recent run of gains, rising 1.77% on the session to close above the 35,000-point level for the first time since 1990, marking a fresh 34-year high for the Asia-based benchmark.
In Europe, the Stoxx 600 was marked 0.2% higher in early Frankfurt trading while Britain’s FTSE 100 slipped 0.13%.
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