On Tuesday night, S&P 500 futures saw a modest increase, buoyed by an optimistic forecast from Oracle. Traders are eagerly anticipating the release of new inflation data, which could provide further insight into the economic landscape. Futures linked to the broad benchmark rose by 0.2%, while Nasdaq 100 futures increased by 0.1%. In contrast, futures tied to the Dow Jones Industrial Average dipped by 49 points, or 0.1%.
On Tuesday, all three major indexes achieved new closing highs. The S&P 500 added 0.27%, with the Nasdaq Composite climbing 0.37%. The Dow Jones Industrial Average gained 196.39 points, equivalent to a 0.43% increase, largely driven by a surge in shares of UnitedHealth.
Shares of Oracle skyrocketed by 26% during Tuesday's extended trading hours after the technology giant reported that its multicloud database revenue from major players like Amazon, Google, and Microsoft surged by an astonishing 1,529% in the last quarter. This remarkable growth was largely fueled by the increasing demand for AI servers. Despite the latest earnings falling short of expectations, investors were optimistic about the company’s cloud forecast.
“We signed four multi-billion-dollar contracts with three different customers in Q1,” stated Oracle CEO Safra Catz. “It was an astonishing quarter — and demand for Oracle Cloud Infrastructure continues to build.” The upbeat news regarding Oracle's performance also positively impacted other AI-adjacent stocks, including Nvidia, which saw a nearly 2% increase.
Looking ahead to Wednesday, traders will be closely monitoring the latest producer price index report. This report, along with Thursday's more closely watched consumer price index (CPI) reading, will shed light on the current state of inflation in the U.S. economy. Economists predict a monthly increase of 0.3% across the board, according to Dow Jones. This expectation includes both the headline all-items indexes and the core readings that exclude the often volatile food and energy prices.
If these projections hold true, it could push the annual headline CPI rate to 2.9%, while the core reading is anticipated to remain steady at 3.1%. According to Art Hogan, chief market strategist at B. Riley Wealth Management, if the inflation numbers align with estimates, it would pave the way for the Federal Reserve to implement another rate cut at its upcoming September meeting. Hogan stated to CNBC, “In general, the inflation news over the next couple of days would have to be remarkably hotter than anticipated for anything to change the narrative that we're getting a rate cut in September.”
