US STOCKS-Futures edge higher as soft inflation data spurs rate-cut bets

The market is back to betting on two quarter-point interest rate cuts from the Federal Reserve this year, with traders seeing a 72.6% chance of the first one in September, according to the CME FedWatch Tool. The Dow is on track to cross the 40,000-mark for the first time, marking the blue-chip index's fastest 10,000-point climb, powered by strong quarterly results and rising bets of rate cuts.

U.S. stock index futures inched higher on Thursday, a day after Wall Street hit all-time highs as a tepid inflation report bolstered hopes of interest-rate cuts.

All three major indexes notched record closes after a smaller-than-expected rise in consumer inflation fueled optimism that inflation was easing after three months of higher-than-expected numbers. The market is back to betting on two quarter-point interest rate cuts from the Federal Reserve this year, with traders seeing a 72.6% chance of the first one in September, according to the CME FedWatch Tool.

The Dow is on track to cross the 40,000-mark for the first time, marking the blue-chip index's fastest 10,000-point climb, powered by strong quarterly results and rising bets of rate cuts. "While the path to disinflation was never going to be without bumps, this latest indicator suggests things are moving in favor of Federal Reserve interest rate cuts this year," Sophie Lund-Yates, lead equity analyst at Hargreaves Lansdown, said in a note.

Markets will now shift their focus to several Fed officials expected to speak through the day, including Thomas Barkin, Loretta Mester, Raphael Bostic, Patrick Harker and Michael Barr. Investors also await data on initial claims for state unemployment benefits due at 8:30 a.m. ET for cues on the strength of the labor market.

Among earnings updates, Walmart advanced 5.6% in premarket trading after the retail giant raised its fiscal 2025 sales and profit forecast, betting on easing inflation to further boost demand for essentials. Deere fell 5.3% after farm equipment maker trimmed its annual profit forecast for the second time.

Cisco Systems rose 3.4% after the network equipment maker forecast fourth-quarter revenue above Wall Street expectations. At 07:11 a.m. ET, Dow E-minis were up 27 points, or 0.07%, S&P 500 E-minis were up 3.75 points, or 0.07%, and Nasdaq 100 E-minis were up 26.25 points, or 0.14%

Most megacap growth and technology stocks climbed, with Nvidia leading gains. U.S.-listed shares of Chubb jumped 8.3% after Warren Buffett's Berkshire Hathaway revealed a stake of 25.9 million shares worth $6.7 billion in the insurer.

Popular meme stocks GameStop and AMC Entertainment slid more than 15% each. They were set to extend Wednesday's losses that followed a two-day rally sparked by the return of "Roaring Kitty" Keith Gill, the central figure in the 2021 meme stock frenzy.

(This story has not been edited by Devdiscourse staff and is auto-generated from a syndicated feed.)