Stock futures rallied in early trading before a key inflation report as gains in the British pound eased concerns about a potential financial markets crisis in the U.K. that has plagued markets in the past one month.
Futures for the Dow Jones Industrial Average were up 290 points, or 0.99%. S&P 500 and Nasdaq 100 futures gained 0.98% and 0.7%, respectively.
The British pound gained more than 1% versus the U.S. dollar on a report that the government there may be rethinking a tax cut plan that had exacerbated a decline in the currency to the lowest in decades at the end of September, putting global markets on edge.
The latest U.S. consumer price index data is slated for release at 8:30 a.m. ET. A Dow Jones consensus estimate shows the CPI rose 0.3% in September, up from 0.1% in August. That would bring inflation’s annual pace to 8.1% from 8.3%. Weekly jobless claims data will also be released Thursday morning.
Thursday’s CPI report comes a day after the government said the producer price index, another inflation gauge, rose more than expected.
On top of that, investors digested minutes from the September Federal Reserve meeting. The minutes showed the central bank expected to keep hiking interest rates until it sees receding inflation. But one comment made some think the Fed might instead slow the rate hikes, if not roll them back, if financial markets tumult continued.
“Fed speakers similarly have, since the last meeting, been wedded to the message that their commitment remains solid, even in the face of global financial fault lines showing signs of strain,” said Quincy Krosby, chief global strategist at LPL Financial.