Stocks poised to open in the red as inflation hits 9.1% in June

Wall Street

Stock futures point to losses

Wall Street futures were pointing to a sharply lower open for stocks on Thursday, a day after data released by the Labor Department showed U.S. inflation rose more than expected in June.

According to the data, consumer price index (CPI) jumped 9.1% on a year-over-year basis, its highest level since the end of 1981. On a month-over-month basis, CPI increased 1.3%, the most since 2005.

Economists expected CPI to have increased 8.8% on a year-over-year basis, and 1.1% on a month-over-month basis.

The red-hot CPI figures mean the Federal Reserve is now expected to hike interest rates by 75 basis points or more, when its policymakers meet later this month.

At around 5:30 a.m. ET, futures tied to the blue-chip Dow plunged 327 points, or 1.06% to 30,431. S&P 500 futures shed 44.25 points, or 1.16% to 3,760.25 while the tech-focused Nasdaq 100 futures lost 129.5 points, or 1.1% to 11,632.75.

Big bank earnings begin

Meanwhile, JPMorgan Chase (JPM) and Morgan Stanley (MS) are set to kick off the unofficial start to the second-quarter earnings season before the opening bell today.

Traders are eagerly awaiting the results to hear what some of Wall Street’s most powerful executives have to say about the state of the economy.

Analysts expect JPMorgan to report earnings of $2.91 per share on revenue of $31.95 billion. Morgan Stanley is seen reporting earnings of $1.57 per share and $13.44 billion in revenue.

Wells Fargo (WFC), Citigroup (C), BlackRock (BLK), Bank of New York Mellon (BK), U.S. Bancorp (USB) will announce their results on Friday.

Crude futures sink as inflation and inventories data weigh

In energy markets, crude futures were also trading lower early Thursday as traders digested the hotter-than-anticipated U.S. inflation figures and inventories data from the Energy Information Administration.

As of 5:30 a.m. ET, U.S. West Texas Intermediate (WTI) crude futures were marked $2.60, or 2.7% lower to $93.70 a barrel. Global Brent crude futures tumbled $2.14, or 2.15% to $97.43 a barrel.

A report published by the EIA on Wednesday showed the biggest weekly increase in crude stockpiles since January, suggesting a slowdown in summer energy demand.

According to the report, U.S. crude stockpiles jumped 3.254 million barrels in the week ended July 8. Analysts expected the report to show a drop of 154,000 barrels.