US STOCKS-Futures rise as investors await inflation data, corporate results

BY Reuters | ECONOMIC | 07:40 AM EST

(For a Reuters live blog on U.S., UK and European stock markets, click/ or type LIVE/ in a news window.)

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December Producer Price Index report due at 8:30 a.m. ET

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Applied Digital (APLD) jumps after report of Macquarie's investment

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Futures up: Dow 0.25%, S&P 500 0.32%, Nasdaq 0.38%

(Updates with analyst comment)

By Johann M Cherian and Sukriti Gupta

Jan 14 (Reuters) -

U.S. stock index futures rose on Tuesday, buoyed by falling Treasury yields as investors awaited the December inflation numbers and upcoming corporate earnings to evaluate the health of the economy.

At 07:11 a.m. ET, Dow E-minis were up 107 points, or 0.25%, S&P 500 E-minis were up 18.75 points, or 0.32% and Nasdaq 100 E-minis were up 79.25 points, or 0.38%.

Providing some respite, yields on longer-dated Treasury bonds dipped on Tuesday, but are near their highest levels since late 2023. Analysts pointed to a report that said the incoming Donald Trump administration was considering gradual tariff hikes, giving the U.S. negotiating leverage.

Traders have pared expectations for a Fed rate cut in 2025, according to data compiled by LSEG, and now see the central bank lowering interest rates by about 27.4 basis points by the end of the year.

"Although the tariff news has seen investors add a few basis points to the total cuts expected for 2025, there is scope for an even larger reversal in the recent moves, highlighting the downside risks to the dollar, should Trump continue to soften his stance on his aggressive policies," said Raffi Boyadjian, lead market analyst at brokerage XM.

The Producer Price Index data, due at 8:30 a.m. ET, will be the first of two reports due this week that will help gauge where inflation stands in the U.S.

Economists polled by Reuters forecast the index to have risen to 3.4% in December from 3% the previous month. The focus will be on healthcare services, portfolio management fees and airfares among the components that feed into the Personal Consumption Expenditure index, the U.S. Federal Reserve's preferred inflation gauge.

Excluding volatile items such as food and energy, the PPI index is expected to have risen to 3.8% in December. The Consumer Price Index data is due on Wednesday.

Quarterly reports from big banks are also highly anticipated later this week, with the lenders expected to report stronger earnings, fueled by robust dealmaking and trading.

JPMorgan Chase & Co (JPM) added 0.4%, Morgan Stanley (MS) rose 0.7% and Citigroup (C/PN) climbed 0.6% in premarket trading.

Wall Street's main indexes have been on a downward trajectory since early December, with the price-weighted Dow down more than 6% from its record high hit last month, and the benchmark S&P 500 at a two-month low.

The central bank's cautious stance on monetary policy easing this year, along with subsequent batches of upbeat economic data, raised investor concerns that inflation might be running high.

Trump is expected to take office on Jan. 20 and his policy proposals on tariffs and immigration are widely expected to fuel inflation.

Comments from Kansas City Fed President Jeffrey Schmid and New York Fed President John Williams, who are voting members on the Federal Open Market Committee, will also be in focus.

AI-bellwether Nvidia (NVDA) rose 1.4% after logging four days of declines, on expectations that fresh U.S. export restrictions could hurt the company's revenues, while Tesla added 2%.

Applied Digital (APLD) jumped more than 25% after a report said Macquarie would take a 15% stake in it and also invest up to $5 billion in the company's AI data centers. (Reporting by Johann M Cherian and Sukriti Gupta in Bengaluru; Editing by Pooja Desai)

In general the bond market is volatile, and fixed income securities carry interest rate risk. (As interest rates rise, bond prices usually fall, and vice versa. This effect is usually more pronounced for longer-term securities.) Fixed income securities also carry inflation risk and credit and default risks for both issuers and counterparties. Unlike individual bonds, most bond funds do not have a maturity date, so avoiding losses caused by price volatility by holding them until maturity is not possible.

Lower-quality debt securities generally offer higher yields, but also involve greater risk of default or price changes due to potential changes in the credit quality of the issuer. Any fixed income security sold or redeemed prior to maturity may be subject to loss.

Before investing, consider the funds' investment objectives, risks, charges, and expenses. Contact Fidelity for a prospectus or, if available, a summary prospectus containing this information. Read it carefully.

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