Cooling Inflation Gives Stock Futures a Boost

The CPI reading could embolden the Fed to skip a rate hike tomorrow

Digital Content Manager
Jun 13, 2023 at 9:08 AM
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The Federal Reserve's efforts to tamper down inflation appear to be working, per the consumer price index (CPI) reading for May, which showed inflation rising at its lowest level in two years at a 4% annual rate. These results are only adding to hopes that the Fed will forego another interest rate hike tomorrow. Futures on both the S&P 500 Index (SPX) and Nasdaq-100 Index (NDX) are edging higher in response, with Dow Jones Industrial Average (DJIA) futures slowly but surely responding in kind.

Continue reading for more on today's market, including:

  • Schaeffer's Senior V.P. of Research Todd Salamone outlines a strategy to plan for a short-term pullback.
  • Options bulls love this natural gas stock.
  • Plus, apparel stock upgraded; Bunge stock slips after merger; and ORCL's strong quarterly results.

Futures 0613

5 Things You Need to Know Today

  1. The Cboe Options Exchange (CBOE) saw more than 1.7 million call contracts and 898,756 put contracts exchanged on Monday. The single-session equity put/call ratio rose to 0.50 and the 21-day moving average stayed at 0.68.
  2. Morgan Stanley upgraded Urban Outfitters, Inc. (NASDAQ:URBN) from "equal weight" to "overweight," with the analyst in coverage noting its low valuation and forecast for 2023. URBN is up 3.8% premarket, and has added 52.5% in the past 12 months.
  3. Bunge Ltd (NYSE:BG) is down 1.9% ahead of the open, after the agribusiness revealed it will merge Netherlands-based Viterra. The stock and cash deal values Bunge at over $8 billion, but also carries over Viterra’s $9.8 billion in debt. BG is off 12.3% year-over-year.
  4. Oracle Corporation (NYSE:ORCL) announced better-than-expected fiscal fourth-quarter earnings and revenue after yesterday's close, and issued as upbeat outlook for the fiscal first quarter amid strength in its cloud services unit. The equity is up 5.2% before the bell, and boasts a 42.4% year-to-date lead.
  5. Today also features the Organization of the Petroleum Exporting Countries' (OPEC) monthly report.
     

OV Buzz Chart June 13

Asian Markets Pop Amid Tailwinds for Chip, Auto Stocks

Japan’s Nikkei jumped 1.8% on Tuesday, surpassing the key 33,000 level, with help from semiconductor and auto stocks. Hong Kong’s Hang Seng added 0.6% for its fourth-straight gain, while China’s Shanghai Composite rose 0.2%, and the South Korean Kospi tacked on 0.3%. The People’s Bank of China made its first move since last August, cutting its seven-day repurchase rate by 10 basis points from 2% to 1.9%, injecting 2 billion Chinese yuan ($279.97 million).

London’s FTSE 100 is inching lower today, after U.K. annual average wage growth rose to a higher-than-expected 7.2% from February to April, while employment rose by 0.2 percentage points, which many believe will pressure the Bank of England (BoE) to raise interest rates. To follow, the British 2-year gilt (a government bond) rose to its highest level since 2008. Meanwhile, the French CAC 40 and German DAX are moving higher at last glance, up 0.06% and 0.2%, respectively.

 

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