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U.S. Futures Mixed; Subdued Trading Ahead of Inflation Data

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Investing.com – U.S. stocks are seen opening mixed Tuesday in subdued trading, with investors cautious ahead of the release of key inflation data later in the week. 

At 7:05 AM ET (1205 GMT), the Dow futures contract was down 70 points, or 0.2%, S&P 500 futures traded 2 points, or 0.1%, lower, while Nasdaq 100 futures climbed 25 points, or 0.2%.

The blue-chip Dow Jones Industrial Average dropped 0.4% on Monday, the broad-based S&P 500 fell 0.1%, while the tech-heavy Nasdaq Composite outperformed, gaining 0.5%.

This continued the tight trading ranges the major averages have endured this month to date, with investors seemingly reluctant to take major positions ahead of the release of the latest inflation numbers on Thursday, one of the few remaining major pieces of economic data ahead of the next Fed meeting on June 15-16.

Economists are expecting the May CPI to rise 4.7% from a year earlier, according to Investing.com, a jump from April’s 4.2%, which was the fastest rise since 2008.

Fed officials have called these inflation levels temporary that will ebb as special factors fade away, but analysts at Deutsche Bank have warned of the dangers if the central bank delays chooses inaction for too long.

“The consequence of delay will be greater disruption of economic and financial activity than would be otherwise be the case when the Fed does finally act,” Deutsche Bank (DE:DBKGn) said, in a note. “In turn, this could create a significant recession and set off a chain of financial distress around the world, particularly in emerging markets.”

In corporate news, Fastly (NYSE:FSLY) could be in the spotlight with the U.S. cloud computing services provider experiencing a technical issue. This could be behind the outage that a number of global news websites including the FT, New York Times and Bloomberg have suffered.

Biogen (NASDAQ:BIIB) could also be in focus after the biotech’s stock gained almost 40% Monday on the back of the FDA approving its groundbreaking Alzheimer’s drug, while Tesla (NASDAQ:TSLA) announced the departure of a key executive late Monday. 

Crude oil prices weakened again Tuesday, as the rally that took prices to multi-year highs faltered.

By 7:05 AM ET, U.S. crude was down 0.7% at $68.73 a barrel, after touching $70 for the first time since October 2018. Brent was down 0.8% at $70.94, after previously hitting $72.26, the highest since May 2019.

The market is watching for any progress between Iran and world powers to revive a nuclear deal, with discussions entering a decisive phase, according to the agency monitoring Tehran’s atomic sites.

A successful conclusion could include Washington lifting economic sanctions on Iranian oil exports, potentially resulting in 500,000 to 1 million barrels of crude per day reentering the global market.

Later in the session, traders will be keeping an eye on the American Petroleum Institute’s weekly estimates of U.S. crude supplies.

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