S&P 500 Futures Hold Gains Despite Hot US PPI

S&P 500 futures rose 0.2% in Asian trading even after a stronger-than-expected US producer price index reduced chances of a larger Federal Reserve rate cut next month. Nasdaq futures slipped for a third day, the 10-year Treasury yield eased to 4.2732%, and Brent crude hovered near a two-month low at $66.79 ahead of a Trump–Putin meeting. Asian markets were mixed, with Japan’s Nikkei 225 up 1.2% on stronger GDP, while Hong Kong’s Hang Seng fell 1.2% on weak Chinese retail and industrial data.

Equities

The FTSE 100 closed 0.1% higher on Thursday, marking a record close and its fourth consecutive daily gain, supported by strength in defence and financial stocks. The FTSE 250 fell 0.2%. Aviva rose 2.5% to a 17-year high after reporting a 22% increase in half-year operating profit and raising its interim dividend, lifting the life insurers’ index by 1.5%.

Admiral Group gained 6.6% after posting a 67% jump in half-year pretax profit, while the non-life insurers’ index rose 1.9%. Centrica climbed 3.7% after announcing a joint £1.5 billion acquisition of National Grid’s Grain LNG terminal with US-based Energy Capital Partners.

In the energy sector, which fell 1.4% overall, Harbour Energy dropped 4.8% and Shell fell over 1%. BP declined close to 1% as its shares traded ex-dividend, alongside HSBC, Hikma Pharmaceuticals, and Hiscox, which each slipped around 1%. Industrial metal miners retreated 2.3%. Diploma lost 2.9% after finance chief Chris Davies stepped down.

On Wall Street, the S&P 500 edged up 0.03% to 6,468.54, reaching a fresh closing high, while the Dow Jones Industrial Average slipped 0.02% to 44,911.26 and the Nasdaq Composite eased 0.01% to 21,710.67. Seven of the S&P 500’s eleven sectors declined after US producer prices rose in July at the fastest annual pace in three years, prompting traders to trim 2025 rate-cut expectations.

Intel jumped 7.4% after reports that the Trump administration is in talks to take a potential stake in the company. Cisco Systems fell 1.6% after issuing a broadly in-line forecast that failed to lift sentiment. Deere & Co slid 6.8% after reporting a lower quarterly profit and narrowing its annual forecast, citing US tariffs as a headwind. Tapestry plunged 15.7% after forecasting annual profit below estimates, also warning on tariffs.

Forex & Commodities

The US dollar was steady against the euro and pound on Friday morning after stronger-than-expected US producer price index (PPI) data in July tempered speculation of an aggressive Federal Reserve rate cut next month. Against the yen, the dollar fell to 147.13 after Japan reported stronger-than-forecast GDP growth, bolstering expectations of a Bank of Japan rate increase. The euro and sterling were little changed after Thursday’s declines ahead of upcoming US retail sales data.

The US PPI rose 3.3% year-on-year in July, the sharpest increase in three years, while weekly jobless claims came in below expectations. The data reduced market pricing for a 50-basis-point cut in September, though expectations for a smaller 25-point move remain high. St. Louis Fed President Alberto Musalem said a larger cut was not warranted, contrasting with US Treasury Secretary Scott Bessent’s earlier suggestion it was possible.

Spot gold was up slightly at $3,341 per ounce early Friday but was still down on the week as the PPI data dampened the outlook for significant Fed easing. A weaker US dollar on the day provided some support to bullion, along with investor caution ahead of the Trump–Putin meeting in Alaska.

Oil prices closed higher on Thursday, with Brent settling at $66.84 a barrel and West Texas Intermediate at $63.96, their strongest finishes since early August. Gains came as markets looked ahead to the US–Russia talks, which could influence Russian crude exports, and as traders continued to expect a Fed rate cut in September. Norwegian data indicated oil and gas investment will peak this year before declining in 2026.