Stock market today: S&P 500, Dow Jones, Nasdaq futures fall as US inflation hits 3.7% in September

Stock market futures declined on Wednesday due to higher-than-expected September inflation in the US. Investors were concerned that persistent rising prices could continue to trouble the economy. Treasury yields rose, adding pressure to the stock market. The S&P 500, Nasdaq, and Dow Jones fell before the market opened. S&P 500 futures dropped 0.2%, while Nasdaq-100 futures fell 0.5%.

Dow Jones futures lost 62 points or 0.1%. US inflation increased to 3.7% in September, surpassing the 3.6% forecast. This higher figure raised worries that prices might remain an issue for the US economy. Prices rose 0.6% from August, which aligned with economists' expectations. However, the annual inflation rate was higher than anticipated, causing investor concerns about the economy's future.

Core inflation, which excludes food and energy prices, also rose above expectations. Core CPI increased by 0.3% month-over-month and 2.6% year-over-year, exceeding the expected 0.2% monthly growth and 2.5% annual growth. Higher Treasury yields could further weigh on stocks, as bonds typically become more attractive when yields rise, reducing demand for stocks.

Higher yields also increase borrowing costs for businesses, potentially harming the prices investors are willing to pay for shares. The inflation report could lead to expectations of near-term interest rate hikes and a stronger US dollar, which might pressure stock valuations, especially as longer-term Treasury yields climb. US gasoline prices averaged $4.34 per gallon, compared to $3.08 a year ago.

Despite temporary relief announced by President Trump for Russian diesel fuel exports, analysts doubt it will significantly lower fuel prices. Higher oil prices, including a nearly 2% increase in West Texas Intermediate (WTI) prices to around $96 per barrel, added to inflation worries. Bank of America shares dropped after reporting lower-than-expected third-quarter results, while Morgan Stanley's shares fell despite beating estimates, indicating that strong individual results may not always boost stock prices.

Big bank earnings have struggled to lift stock prices this earnings season, as investors demand stronger results and better future outlooks. Chip stocks continued their decline due to valuation concerns, with Micron Technology, Advanced Micro Devices, and Intel among the biggest losers. Asian stock markets had mixed results, with Australia's S&P/ASX 200 and South Korea's Kospi falling, while Japan's Nikkei 225 and European markets gained.