Stock Futures Rise Ahead of CPI Due to US Bank Earnings – Europe Market Wrap

Wall Street futures rose as major US banks reported results that exceeded expectations, as investors anticipated a key inflation reading that they believe will surprise to the worse.

Contracts on the Nasdaq 100 and the S&P 500 increased by approximately 0.4%, while financial stocks advanced in premarket trade. BlackRock, Wells Fargo, Goldman Sachs, and JPMorgan all beat expectations for Q4.

While the anticipated inflation report is keeping traders leery of making huge wagers, Treasury 10-year rates have dropped roughly 3 bps.

Meanwhile, investors in Europe were encouraged by data showing that UK consumer prices climbed less than expected in December, fuelling hopes of a BoE rate cut next month. The print sent the Pound down, while 10-year gilt yields fell 9 bps, providing comfort to a market that has taken the brunt of the current bond selloff.

Europe’s Stoxx 600 index jumped 0.8%, while London’s FTSE 350 increased by up to 1.6%.

02:32 ET: UK rate futures point to 73% chance of BoE rate cut in Feb vs 62% before inflation data.

02:00 ET: UK inflation weaker than expected. [Sterling whipsawed]