S&P 500 futures hovered near the flatline Friday morning, but headed for a fifth winning week as investors weighed a cooler-than-expected wholesale inflation. JPMorgan kicked off the start of third-quarter earnings season. Futures tied to the S&P 500 were down slightly, while Nasdaq 100 futures ticked down by 0.2%. Futures linked to the Dow Jones Industrial Average were 25 points higher. The action follows a losing day for the major averages, with the S&P 500 and the 30-stock Dow pulling back from their records Thursday. Despite these losses, the major average are heading for a winning week, with the S&P 500 up 0.5% and on pace for a fifth straight week of gains. The Dow is toting a 0.2% gain, while the Nasdaq is the outperformer of the three, up 0.8% in the period. Third-quarter earnings kicked off with Friday with results from banking giants. JPMorgan Chase topped profit and revenue expectations, however, shares traded into the red after CEO Jamie Dimon said on the earnings call that the bank would be patient with buying back stock at these valuations. Elsewhere, Wells Fargo rose more than 2% on stronger-than-expected earnings. The bank, however, fell short of revenue expectations and reported an 11% decline in net interest income. Beyond earnings, Wall Street weighed fresh data that helped alleviate fears that inflation wasn’t cooling off quick enough. The producer price index, which measures wholesale inflation, remained unchanged in September and came in below the 0.1% increase expected by analysts polled by Dow Jones. That helped temper some fears sparked by September’s consumer price index released Thursday, which rose 0.2% on a monthly basis and 2.4% from a year earlier. Those results topped the 0.1% monthly advance and 2.3% year-over-year gain economists polled by Dow Jones anticipated. “CPI might have seemed hot, but PPI was not,” said TradeStation’s David Russell. “Overall, these numbers are getting less impactful as inflation moderates. The Fed could still be on track for 25 basis points at the next two meetings.” Fed funds futures trading suggests a roughly 84% likelihood that the Federal Reserve will dial back interest rates by a quarter point in November, according to the CME FedWatch Tool. However, central bank policymakers will keep a close eye on additional data, which will shape their course on rates. The U.S. 10-year Treasury yield rose Friday as investors assessed the latest inflation data that came in cooler than expected. The yield on the 10-year Treasury gained 1 basis point to 4.106%, after having ended last week at 3.97%. The yield on the 2-year Treasury was down by 2 basis points to 3.976%. China stocks led declines in Asia-Pacific markets on Friday, after key Wall Street benchmarks fell overnight as investors digested a sticky U.S. inflation report. Mainland China’s CSI 300 blue chip index declined 2.77% to settle at 3,887.17, ending the week 3.25% lower, as a stimulus-fueled rally continues to lose steam. Japan’s Nikkei 225 gained 0.57% to finish at 39,605.8, helped by financials and healthcare sectors. The broad-based Topix fell 0.24% to close at 2,706.2. South Korea’s blue chip Kospi closed marginally lower at 2,596.91, while the small-cap Kosdaq inched 0.59% lower to end at 770.87. Australia’s S&P/ASX 200 fell 0.1% to 8,214.5. Hong Kong markets were closed Friday for a public holiday. U.S. crude oil on Friday was on pace to eek out its second weekly gain in a row as Israel prepares to retaliate against Iran. The U.S. benchmark has gained 1% this week, while global benchmark Brent is ahead 0.8%. Oil prices have gained more than 10% through Thursday’s close since Iran hit Israel with ballistic missiles last week. “Nevertheless, sustaining bullish price momentum in oil has proven to be a high maintenance task: without additional catalysts, the ‘war’ and ‘stimulus’ premiums have shown easy susceptibility to fading,” Natasha Kaneva, head of global commodity strategy at JP Morgan, told clients in a Friday note. West Texas Intermediate November contract: $75.21 per barrel, down 64 cents, or 0.84%. Year to date, U.S. crude oil has gained nearly 5%. Brent December contract: $78.77 per barrel, down 63 cents, or 0.79%. Year to date, the global benchmark has increased about 2%. Gold extended gains on Friday, as the U.S. dollar pulled back from two-month highs on heightened expectations for a Federal Reserve rate cut in November with investors looking forward to the central bank’s key inflation gauge for further direction. Spot gold rose 0.3% to $2,637.31 per ounce. U.S. gold futures gained 0.6% to $2,654.30.
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