U.S. stock futures retreated Thursday as investors awaited new inflation data that would confirm market confidence that the Federal Reserve will cut interest rates next week.
Futures on the Dow Jones Industrial Average (YM=F) and the S&P 500 (ES=F) both fell about 0.2%. Contracts on the tech-heavy Nasdaq 100 (NQ=F) fell nearly 0.3%, leading the way.
A gloomy revenue forecast from Adobe (ADBE) helped dampen the mood and revealed the Photoshop maker’s struggle to turn a profit from its AI investments. The software maker’s shares fell nearly 10% before the market closed.
Investors are primed for the next piece of the inflation puzzle – an update on wholesale prices – after the latest consumer inflation data boosted stocks on Wednesday, lifting the Nasdaq Composite (^IXIC) above 20,000 for the first time.
The in-line consumer price index ended one of the last remaining risks to the Fed’s December easing. That raised bets on a quarter-point rate cut in December to almost a 99% chance, according to the CME FedWatch tool.
For whatever reason, eyes are now on the November Producer Price Index report, which will be released later, to recalculate these probabilities. The Fed’s chances of keeping rates steady in January are also in focus, after several officials expressed cautious views on policy.
Elsewhere among central banks, the Swiss National Bank unexpectedly cut its policy rate by 0.5%, the biggest cut in almost a decade. The move formed the basis for the European Central Bank’s decision later Thursday, which is expected to deliver the fourth interest rate cut this year as the region’s economy struggles.
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