Stock index futures were mixed on Wednesday, as markets saw cautious trading ahead of the December inflation report on Thursday.
Inflation and its impact on bond markets and the Federal Reserve’s monetary policy trajectory remains the primary focus for investors – at least until Friday, when some of the big banks will kick off the fourth-quarter 2023 earnings season.
Economists forecast that annual headline CPI inflation will inch up from 3.1% in November to 3.2% last month. The core reading, which strips out more volatile items like food and energy, is expected to fall from 4% to 3.8%.
“Early optimism seen throughout financial markets may be difficult to maintain given the uncertainty within markets as we head into a crucial second half of the week,” Scope Markets said.
Fundstrat said it expected that “January should prove positive, but much of this strength might come about in the last week of January…the month might prove to be a bit choppier than either bulls or bears would like in the short run.”