US stock futures steady after Wall St rallies on soft CPI, strong bank earnings

Investing.com– U.S. stock index futures rose slightly on Wednesday evening after mildly softer consumer inflation data and a slew of strong bank earnings sparked strong gains on Wall Street. 

Investors also welcomed a U.S.-brokered ceasefire deal between Israel and Hamas, which heralds less geopolitical tensions in the Middle East.

But while Wall Street rallied on Wednesday, investors still remained on edge before President-elect Donald Trump takes office next week, amid uncertainty over his plans for steep trade tariffs.

More economic readings are also due this week, including jobless claims and retail sales data. 

rose 0.1% to 5,993.0 points, while steadied at 21,409.25 points by 18:57 ET (23:57 GMT). rose slightly to 43,498.0 points. 

Soft CPI spurs some rate cut hopes

data released on Wednesday showed inflation unexpectedly eased in December, albeit slightly. inflation in particular read slightly lower than expected, while the headline figure was in line with expectations. 

The data sparked some bets that cooling inflation will invite more interest rate cuts from the Federal Reserve, especially after data released on Tuesday read lower than expected. But overall inflation still remained relatively sticky.

Markets are still pricing in about two rate cuts this year, half of the four initially projected for the year. Higher-for-longer rates signal some pressure on risk-driven assets in the coming months.

Wall Street surged, bank earnings positive 

Wall Street indexes rose sharply in Wednesday’s session, also taking support from a string of positive bank earnings. 

JPMorgan Chase & Co (NYSE:), Wells Fargo & Company (NYSE:), Goldman Sachs Group Inc (NYSE:) and Citigroup Inc (NYSE:) steadied in aftermarket trade after rallying during the session on stronger-than-expected earnings, which kicked off the fourth-quarter earnings season on a positive note. Asset manager BlackRock Inc (NYSE:) also rallied on strong earnings. 

Among other movers, U.S. shares of Brazilian airline Azul SA (NYSE:) surged over 4% after it said it had entered a non-binding deal to explore a merger with rival Gol, creating Brazil’s biggest airline operator. 

Wall Street indexes clocked strong gains on Wednesday, which helped them recover from a sluggish start to the new year. The rose 1.8% to 5,949.81 points, while the rose 2.5% to 19,511.23 points. The jumped 1.7% to 43,221.366 points.