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The main U.S. equity index futures are higher after the release of November year-over-year consumer price data, as well as jobless claims and the Philly Fed business index.

E-mini S&P 500 futures EScv1 are now up around 0.8% vs. a gain of about 0.5% just before the data came out. The U.S. 10-Year Treasury Yield US10YT=RR is now around 4.13%. It was around 4.12% just before the numbers came out. The yield ended Wednesday at 4.151%.

November headline CPI on a year-over-year basis was 2.7% vs a 3.1% estimate. The core year-over-year number was 2.6% vs a 3.0% estimate. The Labor Department's Bureau of Labor Statistics did not publish month-to-month changes for November after the 43-day shutdown of the government prevented the collection of October data. The October CPI release was canceled because the price data could not be collected retroactively.

Initial jobless claims were 224,000 vs a 225,000 estimate. Last week's reading was revised up to 237,000 from 236,000.

The December Philly Fed Business Index was -10.2 vs a 3.0 Reuters Poll. The prior print was -1.7.

According to the CME's FedWatch Tool, the probability that the Fed sits on its hands and leaves its current target rate of 3.50%-3.75% unchanged at its January 27-28 FOMC meeting is now around 71% vs. 73% vs. just before the data was released. The chance that the FOMC cuts rates by 25 basis points is now 29% vs around 27% before the data.

Interest rate probabilities are now pricing in a total of around 64 basis points of cuts through December 2026 vs. around 62 basis points just before the numbers came out.

Most S&P 500 .SPX sector SPDR ETFs are higher in premarket trade. Tech XLK.P, up more than 1.6%, is posting the biggest rise. Tech was already up around 1% before the data was released in the wake of Micron MU.O boosting its profit forecast.

Staples XLP.P, off around 0.3%, is the weakest group.

The SPDR S&P regional banking ETF KRE.P is up nearly 1%.

Regarding the CPI data, Brian Jacobsen, chief economist at Annex Wealth Management in Menomonee Falls, Wisconsin, said:

"Inflation was quite a bit cooler than expected in November. Shelter inflation, the biggest component of CPI, simmered down nicely. Some people will dismiss this report as being more unreliable than usual, but ignore it at your own risk. Other indicators like rent costs and used car prices are consistent with the narrative that the old drivers of inflation aren’t the sources of current inflation."

Jacobsen added "The current sources of inflation are very visible, but not a large component of the consumer basket. Commodities, excluding food and energy, make up less than 20% of the CPI basket. Goods price deflation turned to inflation, but even that inflation hasn’t been as bad as feared. The Fed could look at the increase in the unemployment rate and the tame inflation reading as a reason to cut again. They’ll get some confirming or disconfirming evidence with the next releases before their January meeting."

Here is a premarket snapshot from around 8:55 a.m. ET:

(Terence Gabriel, Chuck Mikolajczak)

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