US stock futures fell on the release of a stronger-than-expected January consumer price index.
The Dow Jones Industrial Average lost 83 points or 0.22%. S&P 500 and Nasdaq 100 futures fell 0.4% and 0.5%, respectively.
The Dow fell in the trading session, closing 156 more points. The S&P 500 was relatively flat, down 0.041%, while the tech-heavy Nasdaq Composite shook off earlier losses to close 0.58% higher.
Inflation data for January slightly beat economists’ estimates, pointing to a potentially longer path for the Federal Reserve to combat rising prices. The consumer price index rose 0.53% for the month and 6.43% from a year earlier, compared with estimates of 0.45% for the month and 6.25% for the year.
While inflation remains above the Federal Reserve’s target of 2.4%, the higher-than-expected readings were not entirely surprising.
Investors also look to the latest retail sales data to gauge consumer demand.
Strategists at Ned Davis Research noted that the market’s strong start, with the S&P 500 up 7.8% in 2023, has left some investors on the sidelines after a tumultuous 2022.
UK inflation fell to 10.12% in January from 10.56% in December.
Mixed European Stocks
European stock markets were mixed on Wednesday, with investors watching US and UK inflation data and banking giant Barclays reporting a sharp drop in annual earnings. Germany’s DAX rose 0.23%, France’s CAC 40 rose 0.24% and Britain’s FTSE 100 fell 0.33%.
Data released on Wednesday showed Britain’s consumer price inflation fell more than expected to 10.12% in January from 10.53% in December, giving some hope that price increases have been avoided. that have affected the standard of living of families in the country.
The Bank of England will announce another increase in borrowing costs next month, but the figures have fueled expectations that a spike in central bank interest rates is not far away.
Back in Europe, investors will focus on European Central Bank chief Christine Lagarde’s speech later in the session, while eurozone industrial production figures for December will be on the lookout.
In the corporate sector, Barclays shares fell more than 7.4% after the UK bank reported a significant 14.4% drop in its annual profits, hit by a £1.6bn lawsuit over the agreed limits on the sale of investment products in the US for excess.
Glencore was also in the spotlight after the trading and mining firm announced a strong $7 billion return for its investors and a record trading profit for 2022 on the back of higher oil and coal prices.
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