U.S. Futures Slip as Investors Eye Bank Earnings and Producer Inflation Data

U.S. stock index futures traded lower on Wednesday as investors prepared for another wave of earnings from major Wall Street banks and awaited fresh inflation data that could influence expectations for Federal Reserve policy.

By 05:40 ET, Dow Jones Futures had fallen 145 points, or 0.3%, S&P 500 Futures were down 27 points, or 0.4%, and Nasdaq 100 Futures slipped 155 points, or 0.6%.

The move followed a weaker session on Wall Street on Tuesday, when the Dow Jones Industrial Average dropped nearly 400 points, or 0.8%. The S&P 500 eased 0.2%, while the Nasdaq Composite slipped 0.1%, reflecting a cautious tone as markets digested political uncertainty and shifting interest rate expectations.

Bank Earnings Take Center Stage

Attention on Wednesday turns to the banking sector, with Bank of America, Wells Fargo, and Citigroup set to report results before the opening bell. Their earnings will be closely watched for insight into the health of the U.S. economy and early year sentiment across corporate America.

The reports follow results from JPMorgan Chase on Tuesday, which officially kicked off the quarterly earnings season. The largest U.S. bank posted a decline in fourth quarter profit, weighed down by provisions linked to its acquisition of a credit card partnership with Apple from Goldman Sachs.

JPMorgan also warned about the potential impact of President Donald Trump’s proposed cap on credit card interest rates, saying it could weigh on industry profitability and consumer access to credit. The comments pressured broader financial stocks and added to market unease.

Beyond headline figures, analysts are likely to scrutinize any commentary on the Federal Reserve, especially after the Trump administration launched a criminal investigation into Fed Chair Jerome Powell. Powell has said the move was intended to influence monetary policy decisions.

JPMorgan CEO Jamie Dimon voiced support for an independent central bank, saying that anything that undermines the Fed’s ability to act free of political influence “is not a good idea.”

More heavyweight financial results are due on Thursday from Goldman Sachs, Morgan Stanley, and BlackRock.

Producer Inflation in Focus

Alongside earnings, markets are awaiting producer price index data for December, due later on Wednesday. The release comes a day after consumer inflation data showed headline CPI largely in line with expectations, while core inflation cooled slightly.

That report did little to change expectations that the Federal Reserve will leave interest rates unchanged later this month. According to CME FedWatch, traders are assigning a 95% probability that the Fed will keep rates in the 3.50% to 3.75% range at its end January meeting.

With earnings season gaining momentum and inflation data still shaping the policy outlook, markets are entering a more data driven phase, where corporate results and price pressures will play a decisive role in setting direction for the weeks ahead.