Stock Futures Rise Amid Nvidia Gains, Inflation Focus

Market Performance and Nvidia Boost

Nasdaq and S&P 500 futures saw notable gains in premarket trading, with the Nasdaq 100 futures climbing 0.59% and S&P 500 futures up 0.35%. The surge was largely driven by Nvidia's 5% premarket increase following the company's announcement of plans to resume AI chip sales in China. This development comes as Nvidia received the necessary permissions to restart the sales of its H20 AI chips, alleviating concerns over trade restrictions between the U.S. and China.

Nvidia's move to reestablish its presence in the Chinese market has been welcomed by investors, as it strengthens the company's foothold in a key region for AI technology. The announcement also lifted other chipmakers, with Advanced Micro Devices rising 3.6% and Marvell Technology gaining 2.7% in premarket trading. Overall, this sectoral boost has added optimism to the broader market sentiment.

Inflation Data and Economic Indicators

The June Consumer Price Index (CPI) report, set for release at 8:30 a.m. ET, is expected to show an inflation increase of 2.7% year-over-year, up from 2.4% in May. On a monthly basis, CPI is forecasted to rise by 0.3%, reflecting a significant acceleration from May's 0.1% increase. Core inflation is anticipated to edge higher to 3% YoY, compared to 2.8% in the prior month.

These inflation figures are critical as they could influence the Federal Reserve's upcoming monetary policy decisions. The market currently estimates a 95.3% probability that the Fed will hold rates steady in July, with a potential rate cut being priced for September. Rising inflation, however, could alter these expectations, particularly if tariffs and global trade uncertainties begin to show more pronounced effects on consumer prices.

Big Bank Earnings and Trade Updates

Earnings season officially kicks off today with JPMorgan, Citigroup, and Wells Fargo set to report their second-quarter results. Analysts expect strong performances from major banks, underpinned by robust trading revenues and a modest recovery in investment banking activity. These earnings will provide insights into how financial institutions are navigating the current economic environment, including the impacts of elevated interest rates.

Meanwhile, trade tensions remain in focus as President Trump's recent tariff threats continue to weigh on global markets. While the president has indicated a willingness to negotiate with key trade partners, including the European Union and Mexico, the uncertainty surrounding potential 30% tariffs starting in August has kept investors cautious. These developments are being closely monitored for their implications on inflation, consumer spending, and overall economic growth.