Wall Street futures ticked down on Thursday as investors treaded carefully ahead of a series of crucial economic reports and corporate earnings releases. By 03:30 ET (07:30 GMT), Dow futures fell by 26 points or 0.1%, while S&P 500 futures were down by 7 points, and Nasdaq 100 futures lost 27 points, all registering a modest 0.1% decline. This cautious sentiment followed a positive session on Wall Street the previous day, driven by optimism surrounding the Federal Reserve's September meeting minutes.

The minutes showed that a "substantial majority" of Fed officials supported a 50-basis point interest rate cut, although some members expressed reservations over the size of the reduction. While the Fed remains divided on the scale of rate cuts, markets are pricing in an 85% chance of a smaller 25-basis point cut in November, according to the CME Group's FedWatch Tool. Traders are also assessing whether the US Consumer Price Index (CPI) report will indicate any significant progress toward the Fed's 2% inflation target.

US Inflation Data Ahead

The highly anticipated CPI report, scheduled for release later today, is expected to show that headline inflation slowed to 2.3% annually in September, down from 2.5% in August, marking a step closer to the Federal Reserve's inflation target. On a monthly basis, CPI growth is forecast to decelerate to 0.1%, down from 0.2% in the previous month. Meanwhile, core CPI, which excludes volatile food and energy prices, is expected to remain at 3.2% year-on-year and ease slightly to 0.2% on a monthly basis.

This report could have a considerable impact on the Fed’s future decisions regarding interest rate cuts, especially as they attempt to navigate a "soft landing" for the US economy — reducing inflation without triggering a sharp downturn in labor markets or overall economic activity.

Alongside inflation data, traders are monitoring weekly initial jobless claims, which are expected to rise to 231,000 from the previous week’s 225,000. While these figures have remained relatively stable, external factors such as Hurricane Milton's impact on the southeastern US and the ongoing strike at Boeing could cause disruptions in employment data.

Corporate Earnings Season

As third-quarter corporate earnings season kicks off, Delta Air Lines is among the first to report. Delta is expected to provide insights on its financial performance, with particular focus on seat growth capacity and how recent declines in fuel prices may benefit the airline in the fourth quarter. Analysts at Bank of America predict Delta’s pricing power could rise significantly from August, despite the summer overcapacity that weighed on fares. The company’s third-quarter revenue previously hit a record $15.4 billion, though it fell slightly short of Wall Street’s expectations.

In individual stocks, Alphabet (NASDAQ: GOOGL) is facing renewed scrutiny after the US Department of Justice suggested it may seek to break up parts of the company’s Google search business. The tech giant’s shares pared some of the losses from earlier in the week.

Crude Oil Prices Rise on Supply Concerns

Oil prices edged higher on Thursday as Hurricane Milton made landfall in Florida, raising concerns over potential supply disruptions in the oil market. Despite the storm largely avoiding the oil infrastructure in the Gulf of Mexico, demand for gasoline in Florida surged, contributing to a rise in crude prices. By 03:31 ET, Brent crude climbed 0.7% to $77.09 per barrel, while US West Texas Intermediate (WTI) futures also gained 0.7%, trading at $73.77 a barrel.

Both Brent and WTI prices have experienced volatility this week, falling around 5% over the last two sessions. However, the potential for escalation in the Middle East conflict, particularly concerning Israel and Iran, remains a critical risk factor for oil markets. Traders are closely watching for any further developments that could impact global oil supply.

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