Stocks futures were bouncing Wednesday as Wall Street tried look past the highest inflation in decades and focus on the start of start of first quarter earnings reporting season.
Futures on the Dow Jones Industrial Average rose 152 points, or 0.4%. S&P 500 futures and Nasdaq 100 futures climbed 0.6% and 0.7%, respectively. Those moves come after the S&P 500 and Nasdaq Composite posted their third straight losing session on Tuesday amid March’s CPI showing the highest inflation since 1981.
First quarter earnings reporting season kicks off Wednesday and analysts have tempered their expectations amid rising commodity costs, the war in Ukraine and the lingering pandemic. But earnings for S&P 500 companies are still expected to increase a healthy 4.5% in the period, according to FactSet.
Delta, BlackRock, and Fastenal earnings results all topped estimates Wednesday morning and the shares were higher in premarket trading. Delta was the biggest winner so far, gaining 6% as its quarterly loss was less than expected and it forecast a return to profitability for this quarter.
JPMorgan Chase shares were slightly lower in premarket trading after the bank reported mixed results. JPMorgan reported a $524 million hit in the quarter following market upheavals related to Russia sanctions that lowered earnings per share by 13 cents. But JPMorgan managed to report $31.59 billion in revenue for the period, slightly more than expected by analysts. It also reported a new $30 billion buyback program.
Traders were awaiting the March producer prices report on Wednesday following the hot CPI report that knocked markets on Tuesday. March PPI was expected to climb 1.1% last month, according to economists polled by Dow Jones. The report is due at 8:30 a.m.
Consumer prices surged 8.5% in March, the Labor Department said on Tuesday. The report fueled further concerns of tighter monetary policy from the Federal Reserve, even as core CPI excluding food and energy costs rose 0.3%, slightly below expectations. Some on Wall Street saw this as a sign that inflation may be nearing a peak.
“I think it’s very likely inflation peaked,” Guggenheim Partners Global chief investment officer Scott Minerd told CNBC’s “Closing Bell: Overtime” on Tuesday. “If it didn’t peak in March, we’re in the process of peaking.”
The 10-year Treasury hit a new three-year high following the report, topping 2.82% before pulling back. On Wednesday, the benchmark rate traded at 2.73%.
Investors assessed the latest round of earnings data from JPMorgan, Delta, and continued to weigh the latest inflation data for March.