Eyes on December CPI data
U.S. stock futures were trading higher early Wednesday, implying stocks would open with slight gains, as market participants await U.S. inflation data for clues on the pace of interest rate hikes.
As of 5:20 a.m. ET, futures tied to the blue-chip Dow Jones climbed 14 points, or 0.04% to 36,142. The tech-heavy Nasdaq 100 futures added 27.25 points, or 0.17% while S&P 500 futures were flat.
The Labor Department is expected to release U.S. consumer price index for December at 8:30 a.m. ET today. Economists polled by FactSet expect CPI inflation to have risen 7.1% on an annual basis in December and 0.5% against the previous month.
Core CPI, which excludes food and energy prices, is expected to have increased 0.5% month-over-month or 5.4% on year-over-year basis.
Powell tells lawmakers the economy is in need of tighter monetary policy
Meanwhile, Federal Reserve Chairman Jerome Powell said in his testimony before the Senate Banking Committee on Tuesday that the U.S economy is healthy enough and rate hikes and tighter policy will be needed to contain inflation.
The Fed boss told lawmakers that the central bank would be ready to step on the brakes if the consumer prices remained elevated.
“We know that high inflation exacts a toll particularly for those less able to meet the higher costs of essentials like food, housing, transportation,” Powell said.
“If we see inflation persisting at high levels longer than expected, then we will…if we have to raise interest rates more over time, we will. We will use our tools to get inflation back,” he added.
However, Powell didn’t announce an accelerated change in monetary policy from what the Fed had already signaled in the minutes of its December FOMC meeting.
Dish Network shares surge on merger rumors
Shares of Dish Network (NASDAQ: DISH) ticked up in premarket trading hours Wednesday after the NYPost reported that the satellite-TV service is once again holding talks about a possible merger with DirecTV.
According to the report, talks between the companies are being pushed by private equity firm TPG Capital. The satellite-TV operators have held on-again, off-again discussions in recent years but have been blocked by federal antitrust regulators.
Sources familiar with the matter told the news outlet that there is optimism a merger between Dish Network and DirecTV could now happen since concerns about the market power of the struggling companies have reduced.
As of writing, shares of Dish Network were up 6.98% to $37.85 in the premarket trading session after rising 4.21% on Tuesday.