The major U.S. index futures indicate a flat opening on Thursday. Stocks are poised to show limited movement after a significant rebound in the previous session.Initially, futures suggested a higher market open. However, they lost ground following a Labor Department report indicating that U.S. producer prices rose slightly more than anticipated in August. The producer price index for final demand edged up by 0.2% in August, according to the Labor Department, compared to revised data showing no change in July. Economists had predicted a 0.1% increase, the same rise originally reported for the previous month.The recent report showing a larger-than-expected uptick in core consumer prices likely diminishes expectations for aggressive interest rate cuts by the Federal Reserve. Concurrently, the annual rate of producer price growth decelerated to 1.7% in August from a revised 2.1% in July. Economists had anticipated a decline to 1.8% year-over-year, down from the initially reported 2.2%.Additionally, a separate Labor Department report revealed a modest rise in first-time claims for U.S. unemployment benefits for the week ending September 7.Wednesday saw stocks initially plummet but then significantly rebound throughout the trading day. The tech-heavy Nasdaq led the recovery, with all major averages ending in positive territory. After an early decline of up to 1.4%, the Nasdaq surged 369.65 points, or 2.2%, to 17,395.53. The S&P 500 gained 58.61 points, or 1.1%, to 5,554.13, while the Dow increased by 124.75 points, or 0.3%, to 40,861.71 after hitting its lowest intraday level in nearly a month.The early sell-off followed the release of the Labor Department’s consumer price inflation report for August. While consumer prices rose in line with expectations, core consumer prices increased slightly more than forecasted. The consumer price index climbed 0.2% in August, matching the rise in July and economist estimates. Excluding food and energy, core consumer prices advanced by 0.3% in August after a 0.2% increase in July, exceeding the anticipated 0.2% rise.The data appeared to reduce the probability of the Federal Reserve opting for a 50 basis-point interest rate cut next week, leading to a sharp early decline in stocks. However, selling pressures eased as the Fed is still expected to lower interest rates in the coming months. According to CME Group’s FedWatch Tool, the likelihood of a half-point rate cut next week has diminished, but a full percentage point reduction by year-end remains probable.”Given the stickiness of services inflation, the Fed will likely cut rates by 25 basis points in the upcoming meeting, reserving the potential for more aggressive action later if the job market further deteriorates,” said Jeffrey Roach, Chief Economist for LPL Financial.Semiconductor stocks played a key role in the market’s turnaround, with the Philadelphia Semiconductor Index jumping 4.9%. Nvidia (NVDA), in particular, saw an 8.0% surge. Networking, software, and computer hardware stocks also showed significant gains, driving the Nasdaq’s rise. Steel and retail stocks performed strongly, while oil producer stocks lagged despite a rebound in crude oil prices.### Commodity and Currency MarketsCrude oil futures climbed $0.73 to $68.04 a barrel after gaining $1.56 to $67.31 a barrel on Wednesday. Meanwhile, gold futures rose $10.90 to $2,553.30 an ounce after slipping $0.70 to $2,542.40 an ounce in the previous session.In currency markets, the U.S. dollar is trading at 142.05 yen, compared to 142.36 yen in New York trading on Wednesday. Against the euro, the dollar is valued at $1.1027, up from $1.1012 yesterday.### AsiaAsian shares advanced on Thursday, bolstered by a tech-driven rally on Wall Street overnight. The dollar remained strong in Asian trading as persistent U.S. inflation concerns tempered hopes for a significant rate cut at the Federal Reserve’s meeting next week.**Gold Slightly Rises, Oil Prices Climb Over 1% Amidst Hurricane Concerns; Asian Markets Mixed**Gold saw a minor increase, while oil prices rose by more than 1%, continuing gains from the previous session due to concerns that Hurricane Francine might disrupt U.S. production.Chinese stocks lagged behind other regional markets driven by economic worries and escalating geopolitical tensions ahead of the upcoming U.S. presidential elections in November. The Shanghai Composite Index dipped by 0.2% to close at 2,717.12, whereas Hong Kong’s Hang Seng Index increased by 0.8% to finish at 17,240.39.Japanese equities experienced their largest surge in a month, thanks to a pause in the yen’s rally which boosted semiconductor stocks and automakers. The Nikkei 225 Index soared 3.4% to 36,833.27, ending a seven-day losing streak. The broader Topix Index rose by 2.4% to 2,592.50.Blue-chip stocks like Honda Motor and Toyota each surged by approximately 4%, while Advantest jumped 9.2% and Tokyo Electron gained 4.8%. Financial giant Mitsubishi UFJ Financial Group climbed 2.2% following gains in long-term Treasury yields.On the economic front, the Bank of Japan reported that producer price inflation in Japan eased in August from an 11-month high in July. The producer price index increased by 2.5% year-over-year in August, compared to a 3.0% rise in July.South Korea’s Kospi rose 2.3% to 2,572.09, after the country’s top financial regulator announced plans to lift the ban on short selling by the end of March. Samsung Electronics advanced 2.2% amidst reports of impending layoffs of over 200 executives in India due to slowing business growth and weakening consumer demand.Australian markets saw significant gains, driven by bank and energy stocks. The S&P/ASX 200 Index rose by 1.1% to 8,075.70, while the broader All Ordinaries Index climbed 1.2% to 8,293.10. Nine Entertainment shares dropped by over 4% before recovering to close 0.8% higher following the resignation of CEO Mike Sneesby.In New Zealand, the S&P/NZX-50 Index jumped 1.5% to 12,820.28, boosted by data showing a 0.4% increase in food prices over the 12 months to August 2024, following a 0.6% rise in the previous 12 months.**Europe**European stocks saw a strong rally on Thursday after the European Central Bank announced a widely expected interest rate cut of 25 basis points. The pan-European STOXX 600 Index rose by 1.1% to 513.68, after finishing flat with a slight positive bias on Wednesday.Major indexes also showed gains: the German DAX Index increased by 1.2%, the French CAC 40 Index by 1.0%, and the U.K.’s FTSE 100 Index by 0.9%.The U.S. dollar firmed up following the release of August U.S. Consumer Price Index (CPI) data, which came in line with estimates. However, core CPI inflation rose more than expected, reducing the likelihood of a 50-basis point rate cut at the upcoming Federal Open Market Committee (FOMC) meeting.Technology stocks followed the upward trend of their U.S. counterparts, with companies like Infineon and ASML Holding seeing significant gains. Nordex SE surged as well, after securing an order from renewable energy company Ørsted for its 43 MW Farranrory wind farm in Ireland.British banks Lloyds Banking Group, HSBC, and Standard Chartered moved higher after the Bank of England eased a proposed overhaul of the banking system. Trainline also soared after strong first-half results and an upgraded full-year profit forecast, and IG Group Holdings advanced after reporting a revenue jump in its first quarter.Conversely, Swiss drug maker Santhera Pharmaceuticals Holding AG plummeted after reporting a first-half net loss of 15.3 million Swiss Francs. Roche also declined following reports that an early-stage trial of an obesity medication showed a high rate of temporary side effects.**U.S. Economic News**A report from the U.S. Labor Department on Thursday revealed that producer prices increased slightly more than anticipated in August. The producer price index for final demand edged up by 0.2% in August, while revised data showed no change in July. Economists had expected a 0.1% increase, consistent with initial reports for the previous month.Additionally, the annual rate of producer price growth slowed to 1.7% in August, down from a revised 2.1% in July. The year-over-year increase was expected to decelerate to 1.8% from the originally reported 2.2% for July.The Labor Department also released a separate report indicating a modest rise in initial claims for U.S. unemployment benefits for the week ending September 7th.Job Market and Treasury ActivitiesThe latest report indicates that initial jobless claims have risen to 230,000, marking an increase of 2,000 from the previous week’s adjusted figure of 228,000. Economists had anticipated a minor increase to 230,000 from the initially reported 227,000 for the prior week.Additionally, the Labor Department noted that the less volatile four-week moving average edged up to 230,750, which is a 500 increase from the previous week’s revised average of 230,250.At 11 AM ET, the Treasury Department is expected to release details regarding this month’s auction of twenty-year bonds. Later, at 1 PM ET, results for this month’s auction of $22 billion in thirty-year bonds will also be announced.Market MoversIn pre-market trading, Alaska Air Group (ALK) shares are surging after the airline revised its third-quarter earnings guidance upwards. Similarly, U.S. Bancorp (USB) may experience gains following the announcement of a $5 billion share repurchase program and an increase in its quarterly dividend to $0.50 per share.Conversely, shares of Moderna (MRNA) are experiencing significant pre-market declines after the company projected it would cut annual R&D expenses by approximately $1.1 billion by 2027. Additionally, Oxford Industries (OXM) may face downward pressure after unveiling weaker-than-expected fiscal second quarter results.The material has been provided by InstaForex Company – www.instaforex.com
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