Investing.com – U.S. stock futures fell in after-hours trading on Wednesday, extending losses on Wall Street after hotter-than-expected inflation data sent investors slamming expectations for a rate cut in June.
Losses in stock markets also came as minutes from the Federal Reserve’s March meeting showed the central bank needed much more convincing evidence that inflation was slowing – a trend likely to be strengthened by March data.
fell 0.25% to 5,194.25 and was down 0.25% to 18,151.75 by 7:17 pm ET (2317 GMT). fell 0.26% to 38,656.0 points.
Wall Street falls as consumer price index beats expectations for fourth month in a row
Consumer price index data for March beat expectations on Wednesday, coming in above expectations for the fourth month in a row.
The reading comes as Fed officials have repeatedly warned that persistent inflation will delay any potential interest rate cut in 2024.
Wall Street indexes fell on the prospect of higher and longer-term rates, and stretched valuations for technology companies also made the sector particularly vulnerable to profit-taking.
Quotes fell almost 1% to close at 5,160.64 points, while quotations lost 0.8% to close at 16,170.36 points. It fell 1.1% to 38,461.51 points.
June rate cut bets evaporate after hot CPI and hawkish minutes
Hot CPI data coupled with upbeat minutes from the Fed’s March meeting led traders to sharply revise expectations for a 25 basis point hike in June.
Markets are now pricing in an 81.8% chance that the Fed will keep rates steady in June, more than double the 37.1% chance seen last week, the survey showed.
Markets also see only a 17.5% chance of a rate cut in June, down from 61.1% seen last week.
Minutes from the Fed’s March meeting showed that central bank officials were already concerned that progress in reducing inflation had stalled and that they may need to keep rates high longer.
There have also been rumors among central bank officials about further interest rate hikes, although no Fed member has directly called for further rate hikes.
Banks and BlackRock earnings expected
The focus now turns to the first-quarter earnings season, with Delta Air Lines Inc (NYSE:) starting the season with stronger-than-expected results. However, shares still fell more than 2% on Wednesday.
Earnings of Wall Street banks JPMorgan Chase & Co (NYSE:), Citigroup Inc (NYSE:) and Wells Fargo Co. & Company (NYSE:) is scheduled to report Friday, and BlackRock Inc (NYSE:), the world’s largest asset manager, will report earnings before the bell on Friday.
Among notable aftermarket leaders, Alpine Immune Sciences Inc (NASDAQ:) shares rose 36.5% after the company said it would be acquired by Vertex Pharmaceuticals Inc (NASDAQ:). Vertex fell 1%.