TSX futures inch higher ahead of key U.S. inflation report

Investing.com - Futures linked to Canada’s main stock exchange pointed higher on Tuesday as investors awaited the release of key U.S. inflation data and assessed an extension to a trade truce between Washington and China.

By 06:27 ET (10:27 GMT), the S&P/TSX 60 index standard futures contract had edged up by 2 points, or 0.1%.

The S&P/TSX composite index rose in the prior session, ending higher by 0.1% at 27,775.23. The uptick came after the index posted its best weekly performance since September last week.

A jump in shares of Constellation Software (TSX:CSU) gave some lift to the technology sector, helping offset a dip in the materials segment stemming from weaker gold prices.

U.S. futures subdued

U.S. stock index futures hovered around the flatline, as investors took caution ahead of the inflation data.

At 06:36 ET, Dow Jones Futures traded 21 points, or 0.1%, higher, S&P 500 Futures slipped 7 points, or 0.1%, and Nasdaq 100 Futures were mostly unchanged.

The main averages on Wall Street slipped in the prior session, although both the tech-heavy Nasdaq Composite and the broad-based S&P 500 indices remain near to all-time highs, helped a broadly successful second-quarter earnings season.

Investors also appeared to pass over President Donald Trump’s announcement of a 90-day extension to a trade truce between the U.S. and China, with the move occurring just ahead of the Aug. 12 deadline.

CPI data in spotlight

The latest monthly consumer price index will be in the spotlight Tuesday.

The closely-monitored gauge of inflation is expected to accelerate slightly to 2.8% in the twelve months to July, a month-over-month rise of 0.2%. Stripping out volatile items like food and fuel, so-called "core" CPI is tipped to speed up to 3.0% year-over-year and 0.3% on a monthly basis.

Following a weak July jobs report and sharp downward revisions to the readings for June and May, bets have risen to an approximate 90% likelihood that the Federal Reserve will slash borrowing costs by 25 basis points at its upcoming gathering in September.

Any signs of hotter-than-estimated price gains may give policymakers some pause, particularly as the Fed has recently adopted a more cautious attitude to rate cuts partially due to worries that Trump’s aggressive tariff agenda could drive up inflation.

The stance has drawn the ire of Trump, who has called for immediate and deep drawdowns, while dissent to the "wait-and-see" approach was notable in the Fed’s last policy decision in July.

Trump announces BLS head nominee

Investors will also be digesting Trump’s nomination of economist E.J. Antoni as head of the Labor Department’s Bureau of Labor Statistics in the wake of his decison to fire the previous head, Erika McEntarfer, in the wake of the disappointing jobs report at the start of the month. The Senate must still confirm the appointment.

Trump accused McEntarfer, without proving any evidence, of doctoring the figures to damage him politically.

Sinclair surges on merger options

In the corporate sector, Sinclair shares surged in premarket trading, after the U.S. TV station owner said it was reviewing its business for potential mergers or a ventures unit spinoff.

Specialty chemical company Celanese (NYSE:CE) shares tumbled following its warning that it sees “a softening demand environment across most key end-markets in the second half of the year.”

Tencent Music Entertainment Group (NYSE:TME) stock climbed in premarket trading after the company reported better-than-expected results for the second quarter.

Pony AI stock gained premarket after the Chinese robotaxi operator reported a surge in second-quarter revenue, and said it was on track to reach its year-end vehicle target.

Gold ticks higher

Spot gold prices edged higher after a sharp decline in the previous session, as investors await the U.S. inflation data and gauged the potential for future Fed policy easing.

In early afternoon trading in Europe, spot gold had edged 0.2% higher to $3,347.92 an ounce, while gold futures for December dipped by 0.2% to $3,395.70/oz by 06:36 ET.

Gold prices fell 1.6% on Monday, and futures dropped more than 2% after U.S. President Donald Trump said gold bars would not face tariffs, easing supply concerns.

Crude steadies after China tariff truce extended

Crude prices steadied following the extension of the pause on higher tariffs between the United States and China, which helped soothe some concerns over a hit to global economic growth in the world’s two largest oil consumers.

At 06:37 ET, Brent futures climbed 0.1% to $66.72 a barrel, and U.S. West Texas Intermediate crude futures moved up 0.1% to $64.00 a barrel.

Potentially weighing on the oil market, Trump and Russian President Vladimir Putin are due to meet in Alaska on Friday to discuss an end to the war in Ukraine.