Stock futures were up Friday while oil edged lower as investors remained

cautious ahead of key U.S. consumer-price inflation data.

U.S. government bond yields were also retreating after threatening to breach 5% late Thursday.

August's consumer price index is set to be released at 8:30 a.m .EST and it's the last inflation report before the Federal Reserve's meeting next week. Analysts forecast headline annual CPI at 3.4% on year, unmoved from July.

"A reading close to or below expectations could pull [10-year] Treasury yields away from 5%, reduce pressure for an immediate rate increase and allow U.S. and European equity futures to extend their early stabilization," GivTrade said.

Meanwhile, oil prices slipped, but were still headed for weekly gains of 10% after climbing back above $100 a barrel.

"Oil's resilience reflects a market now repricing both the duration and severity of the conflict, along with a clearer recognition of the mounting threat to regional supply," ING said.

The International Energy Agency said a recovery in Middle East oil flows is now expected to stretch into next year as escalating attacks on Gulf shipping and Houthi threats in the Red Sea keep key energy arteries under strain.

Stocks to watch

Adobe said its shift to a "freemium" business model could slow near-term revenue growth, knocking Adobe stock this morning by 2% ahead of the opening bell.

Copart's shares rose 7% premarket. Copart said late Thursday it had agreed to buy rival ACV auctions for almost $2 billion.

Oracle jumped 7% in premarket trading after Oracle posted sharply higher profit and revenue, with sales from its cloud-infrastructure business more than doubling.

RH gained almost 7% premarket after RH's revenues and profits beat analysts' forecasts.

Watch For:

U.S. CPI for August; U.S. University of Michigan Preliminary Consumer Survey for September; World Agricultural Supply & Demand Estimates (WASDE); Canada Industrial Capacity Utilization Rates for 2Q

Today's Top Headlines/Must Reads:

- Iranians Are Running Out of Gas as Economic Squeeze Takes Hold

- The Race for the Next Big Weight-Loss Drug Is On-and China Wants In

- At Bending Spoons, the Numbers Are the Real Mind-Bender

MARKET WRAPS Forex:

The dollar traded steady as investors awaited the U.S. inflation data.

Bonds:

Treasury yields stabilized, having hit new multiyear highs earlier in the session.

Commerzbank rates strategists confirmed their caution on bond duration. "The market is struggling to establish a new range, while oil prices stay under pressure and central banks stick with their laissez-faire attitude toward rising bond yields."

Energy:

Front-month Brent crude oil futures fell 2.1%, while front-month WTI crude oil futures dropped 1.7%.

Metals:

Gold prices were headed for a weekly loss of more than 2%, weighed down by surging oil prices, higher bond yields and rising rate-hike expectations.

Gold chart

Comex gold futures were likely consolidating above support at $4,300 per ounce, based on the daily chart, RHB Retail Research said.

Copper

Copper prices trimmed gains after surging this week to their highest level on record, with three-month futures on the LME now up 0.3% to $14,233 a metric ton. It had surged above $14,800 a ton in the previous session.

Iron ore

Iron ore was lower in early trade. It was weighed by expectations of weaker fundamentals despite some near-term support from steel mills' preholiday restocking, Baocheng Futures said.

TODAY'S TOP HEADLINES

At Bending Spoons, the Numbers Are the Real Mind-Bender

Bending Spoons is a debt-funded serial acquirer that went public in July. Its name is a nod to psychic powers, but the real hocus-pocus is in the company's numbers.

The Milan-based company has been hoovering up fading digital-subscription and software companies for years, including AOL, Evernote and Vimeo. Its shares are up 37% since the initial public offering, and its stock-market value is about $28 billion. That is almost 14 times its revenue over the last four quarters and more than 100 times earnings.

Orsted Gets Commission Backing in U.K. Tax Case

Orsted said an advisory commission has ruled that two of the Danish wind farm developer's British projects should be primarily taxed in the U.K., backing the company's position in a long-running dispute between Danish and U.K. tax authorities.

Orsted had asked authorities in Denmark and the U.K. to clarify taxation rights between the two countries in 2015, so that its Walney Extension and Hornsea 1 U.K. offshore wind farms wouldn't be double-taxed.

Kalshi Looks to Expand a Rapidly Growing Universe of Risky Trading

A risky type of trade that has exploded in popularity overseas this year is poised to become more mainstream in the U.S.

Prediction markets platform Kalshi is planning to seek regulatory approval to start offering the country's first regulated perpetual futures tied to single stocks including Tesla, Apple and Nvidia, according to people familiar with the matter.

Real Test for China's 'Four Little GPU Tigers' Has yet to Come

Shares of Shanghai Enflame Technology more than doubled on their trading debut. But the real test for the Chinese company, along with three other so-called "little GPU tigers," has yet to come.

Enflame's listing follows last year's Shanghai debuts for Moore Threads and MetaX Integrated Circuits, as well as Shanghai Biren Technology, which listed in Hong Kong early this year.

Yields on U.S., European Government Bonds Lower But Still Near Multiyear Highs

European government bond yields edged lower on Friday as U.S. Treasury yields stabilized, having hit new multiyear highs earlier in the session.

The 10-year German Bund yield rose to a new 15-year high of 3.515% before reversing to 3.502%, while the 10-year U.S. Treasury yield also moved slightly away from the 5% level, last trading at 4.941%, down 0.2 basis point, according to Tradeweb. The reversal came on the back of declining oil prices, even as Brent remained above $105 a barrel.

U.S.-Iran Escalation to Delay Oil Flow Recovery Into Next Year, IEA Says

A recovery in Middle East oil flows is now expected to stretch into next year as escalating attacks on Gulf shipping and Houthi threats in the Red Sea keep key energy arteries under strain, the International Energy Agency said.

The energy watchdog-a group of Western nations and their allies-further cut its outlook for global oil demand, now expecting consumption to fall by 2.5 million barrels a day in 2026 to 102.4 million barrels a day, compared with its previous forecast for a 1.6-million-barrel-a-day decline.

Oil Prices Slip After Recent Surge Amid Supply Risks

Oil prices fell in early European trading Friday after surging in the previous session, as traders assessed growing risks to Middle East crude exports following fresh territorial gains by Iran-backed Houthi militants in Yemen.

Front-month Brent crude oil futures fell 2.1% to $105.36 a barrel, while front-month West Texas Intermediate crude oil futures dropped 1.7% to $100.69 a barrel. Both benchmarks settled Thursday at their highest closing levels since May 19, with Brent at $107.63 and WTI at $102.48.

Key Takeaways From Day Two of the Republican Midterm Convention

DALLAS-JD Vance delivered a fiery, future-looking speech on the second night of the GOP midterm convention that showcased the vice president's vision of America and will intensify speculation about his presidential aspirations.

The evening lacked the big surprises unveiled Wednesday night that included a video address by Democratic Sen. John Fetterman and President Trump's promise to pay Americans $5,000 if Republicans win in November. But it delivered poignant moments, as speakers and video tributes memorialized the anniversary of the assassination of Charlie Kirk and the Sept. 11 terrorist attacks. Two parents whose daughter was allegedly killed by an undocumented immigrant brought many in the audience to tears as they recounted their loss.

Iranians Are Running Out of Gas as Economic Squeeze Takes Hold

Long lines at gas stations. Strikes by truckers. A government struggling to maintain the subsidies that had helped much of the population keep their heads above water.

The economic fallout from the war and the American blockade is adding to the pain facing ordinary Iranians who are already struggling with a plunging currency, worsening joblessness and rising prices for everything from food to trash bags.

Pentagon in Talks to Get Into AI Infrastructure Funding With a $5 Billion Loan

The Pentagon is in talks to lend roughly $5 billion to AI cloud-computing startup Fluidstack, according to people familiar with the matter, adding the U.S. military to the growing list of financiers of artificial-intelligence infrastructure.

The money would come from the Pentagon's Office of Strategic Capital, which provides loans to companies working in areas deemed critical to U.S. national security. A $5 billion loan would be, by far, the office's largest to date.

Congress Is Suddenly Waking Up to the AI Doomsday Threat

WASHINGTON-A groundswell of urgency over artificial intelligence is surging in Congress amid growing fears that the technology could destroy civilization.

After years of limited actions, dozens of lawmakers are now touting new proposals to regulate artificial-intelligence models that have stepped up their capabilities.

Write to priscila.barrera@wsj.com

TODAY IN CANADA Earnings:

Nothing major scheduled.

Economic Indicators (ET):

0830 Q2 Industrial capacity utilization rates

Stocks to Watch: