U.S. Stock Futures Climb on Expectations of Further Fed Easing After Subdued CPI Report

U.S. stock index futures advanced Wednesday, extending recent gains after softer inflation data reinforced expectations for a Federal Reserve interest rate cut next month.

At 06:10 ET (10:10 GMT), Dow Jones Futures rose 130 points, or 0.3%, S&P 500 Futures added 15 points, or 0.2%, and Nasdaq 100 Futures gained 65 points, or 0.3%.

All three major Wall Street benchmarks climbed more than 1% on Tuesday, with the S&P 500 and the tech-focused Nasdaq closing at fresh record highs. The move followed subdued consumer price growth, which bolstered market bets on a Fed rate reduction at its September meeting.

Fed Rate Cut Expectations Strengthen

Tuesday’s data showed U.S. consumer prices remained steady at 2.7% annually in July, matching June’s pace and slightly below the 2.8% forecast. Core CPI, which excludes food and energy, rose 0.3% month-over-month and 3.1% year-over-year, just above the 3.0% projection.

“Inflation was broadly in line with expectations as tariffs continue to be absorbed within U.S. corporate margins,” ING analysts noted. “This gives the Fed scope to address weaker labor market conditions and begin cutting rates in September.”

BCA Research echoed this sentiment, suggesting the data “tips the scales in favor” of a 25-basis-point cut at the Fed’s next meeting. They anticipate one or two additional cuts before year-end as policymakers prioritize economic support despite inflation remaining above target.

A producer price index reading is due Thursday, followed by retail sales figures and a consumer sentiment survey on Friday.

Cisco Earnings on Deck

Cisco Systems (NASDAQ: CSCO) will report results after the market close, kicking off a wave of quarterly releases from companies with fiscal periods ending in July. Analysts at Piper Sandler expect earnings to beat forecasts, supported by robust firewall sales and growth in cybersecurity subscriptions.

“Cisco is maintaining positive momentum into the second half, with early networking results signaling strength in the sector and 2026 shaping up as a major upgrade cycle,” analysts led by James Fish stated.

Meanwhile, CAVA Group (NYSE: CAVA) shares fell sharply in premarket trading after second-quarter revenue missed expectations due to weak same-store sales. The Mediterranean food chain also lowered its full-year same-store sales outlook.

Separately, Perplexity AI made an unsolicited $34.5 billion all-cash offer to acquire Google’s Chrome browser, aiming to leverage its massive user base to train AI models.

Oil Prices Slide on IEA Outlook

Crude futures declined after the International Energy Agency raised its 2025 global supply forecast while trimming demand expectations.

At 06:10 ET, Brent crude fell 0.6% to $65.71 a barrel, and U.S. West Texas Intermediate dropped 0.8% to $62.67.

In its monthly report, the IEA projected global oil supply to rise by 2.5 million barrels per day (bpd) next year—up from 2.1 million bpd previously—driven by increased OPEC output. The agency also lowered its 2025 demand growth forecast to 680,000 bpd from 700,000 bpd.