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U.S. stocks held steady on Wednesday, looking at new record highs ahead of a crucial consumer prices update that could undermine hopes for rate cuts, and as meme stocks regrouped after a roaring rally.
Futures on the Dow Jones Industrial Average (YM=F) and S&P 500 (ES=F) hovered above the flat line. Contracts on the Nasdaq 100 (NQ=F) are also little changed after a new spike for technology stocks.
Stocks have soared higher while boosting confidence that the U.S. economy is in good enough shape for the Federal Reserve to start cutting interest rates from their current historic highs. That optimism has led to a resurgence of bullishness in the market.
The release of the consumer price index later Wednesday could put these hopes to the test. After a string of good data, another CPI surprise in April could fuel more worries that an overheated economy will force the Fed to raise rates again, undermining the case for more gains in stocks and bonds. The overall figure is expected to fall to 3.4%.
Read more: What influence does the labor market have on inflation?
Meanwhile, the pace in the frenzied meme stock rally slowed, with the prices of GameStop (GME) and AMC (AMC) more than doubling at one point on Tuesday. Both stocks rose more than 20% in early pre-market action, but pared those gains to trade slightly higher at last check.
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