U.S. stock futures add to losses after mixed August producer inflation report

U.S. stock futures wavered around a flatline on Thursday amid high oil prices, which kept investors uncertain ahead of significant U.S. inflation data that could influence the Federal Reserve's upcoming policy decision. By 06:27 ET, the Dow futures had climbed 123 points (0.2%) and the S&P 500 futures increased by 7 points (0.1%), while the Nasdaq 100 futures slipped by 59 points (0.2%).

Market participants saw stocks on Wall Street slip the previous day, with the Dow Jones Industrial Average down 0.8%, the S&P 500 falling 0.5%, and the Nasdaq Composite falling 0.6%, marking a third consecutive day of losses for major indexes. The focus remained on the uptick in energy prices that pushed Brent crude above $100 a barrel for the first time since July, driven by rising tensions between the U.S. and Iran.

This has sparked concerns that a prolonged energy shock could keep inflation high, prompting policymakers to consider raising interest rates. The 10-year Treasury yield dipped 20 basis points to 4.82% as it rose to a high of 4.85% on Wednesday, its peak since November 2023. The Treasury Department's plan to repurchase $6 billion in longer-dated government debt did not excite some analysts, who had hoped for as much as $10 billion in repurchases.

The focus now shifts to Thursday's producer price index report, the first of two major inflation readings this week, followed by the consumer price index on Friday. Market expectations are for at least one rate increase this year, with traders pricing a 60% chance of a hike during the conclusion of the two-day Federal Reserve meeting next Wednesday.

Concerns over energy-driven inflation have led European Central Bank officials to be expected to raise rates later on Thursday, though no specific policy guidance is anticipated. On the earnings front, cloud computing leader Oracle and design software firm Adobe were set to release quarterly results after the market closed. These results may shed light on the surge in spending on artificial intelligence infrastructure.

Additionally, Apple (NASDAQ:AAPL) garnered attention following the unveiling of its first foldable iPhone at the company's first major product event under new Chief Executive John Ternus. Apple shares closed 0.3% lower in the previous session.