Wall St set for strong open as megacaps recover; inflation data in focus
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US inflation rises moderately in June
Russell 2000 futures jump
Deckers, Baker Hughes climb after results
Dexcom slips after cutting revenue forecast
Futures up: Dow 0.54%, S&P 500 0.71%, Nasdaq 0.93%
Updated at 8:48 a.m. ET/1248 GMT
By Ankika Biswas and Lisa Pauline Mattackal
July 26 (Reuters) - Wall Street's main indexes were poised for a strong opening on Friday, with the Nasdaq taking the lead asmegacap tech and chip stocks recovered from the week's pummeling and a largely in-line key inflation reading kept rate-cut bets intact.
Data showed the Personal Consumption Expenditures Price Index, the U.S. Federal Reserve's preferred inflation metric, rose 0.1% on a monthly basis in June and 2.5% annually, both as expected.
Core PCE, which excludes the volatile food and energy components, increased 0.2% monthly and 2.6% on an annual basis, both slightly above estimates.
The moderate rise in U.S. prices underscored an improving inflation environment, potentially positioning the Fed to begin easing policy in September.
"You've got a pretty nice (inflation) report here that further emboldens the soft landing narrative," said Rick Meckler, partner at Cherry Lane Investments.
Bets of a 25-basis-point cut by the Fed's September meeting edged up to 91.5%, from 88% before the data, according to CME's FedWatch. Traders largely expect around two rate cuts by December, according to LSEG data.
All the so-called Magnificent Seven stocks - Apple AAPL.O, Nvidia NVDA.O, Alphabet GOOGL.O, Microsoft MSFT.O, Meta Platforms META.O, Amazon.com AMZN.O and Tesla TSLA.O - were up between 0.6% and 3.5% in premarket trading.
The 10-year Treasury yield US10YT=RR turned lower after the PCE data.
Chip stocks also rebounded, with Intel INTC.O, Broadcom AVGO.O, Qualcomm QCOM.O, Micron Technology MU.O and Arm Holdings ARM.O up between 1.4% and 3.4%.
At 8:48 a.m. ET, Dow e-minis 1YMcv1 were up 219 points, or 0.54%, S&P 500 e-minis EScv1 were up 38.75 points, or 0.71%, and Nasdaq 100 e-minis NQcv1 were up 177 points, or 0.93%.
Investors have dumped tech stocks over thepast few weeks, with disappointing earnings from Alphabet and Tesla sparking a sharp sell-offin megacap and artificial-intelligence-linked shareson Wednesday. The S&P 500 and the Nasdaq were on track for asecond straight weekly decline if losses hold.
"While it's been a rough week for the S&P and the Nasdaq, the rotation in the small caps and cyclicals has continued to have a much better week," Meckler said.
Concerns about WallStreet's growing dependence on a set of high-momentum stocks, whose valuations now appear inflated, have made underperformingsectors like mid- and small-cap stocks seem more attractive on the prospectof early rate cuts.
Futures tracking the Russell 2000 RTYcv1 jumped 1.2% on the day, with the small-cap index set for its third straight week of gains if trends hold.
Data released earlier this week showedfaster-than-expected second-quarter economic growth and subsiding inflationary pressures, keepinghopes of a September rate cut alive andboosting the blue-chip Dow and the small-cap Russell 2000 .RUT.
Deckers Outdoor DECK.N jumped 13.1% after raising its annual profit forecast, while Oilfield services firm Baker Hughes BKR.O climbed 3.1% after beating estimates for second-quarter profit.
Medical device maker Dexcom DXCM.O slumped 38.3% after cutting its annual revenue forecast.
Reporting by Ankika Biswas and Lisa Mattackal in Bengaluru; Editing by Saumyadeb Chakrabarty and Pooja Desai
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Semua bahan yang diterbitkan di Kemudahan Dagangan Atas Talian kami bertujuan hanya untuk tujuan pendidikan/maklumat dan tidak mengandungi – dan tidak boleh dianggap mengandungi nasihat kewangan, cukai pelaburan atau dagangan dan cadangan, atau rekod harga dagangan kami, atau tawaran, atau permintaan untuk suatu transaksi dalam sebarang instrumen kewangan atau promosi kewangan yang tidak diminta kepada anda.
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