S&P 500: Oil Retreat Lifts US Stock Futures Ahead of Critical CPI Report

Oil Pullback Gave Futures a Lift but CPI Owns the Session

Stock futures caught a bid Friday morning after crude oil pulled back from the week’s surge. Buyers stepped back into equities on the retreat. Oracle jumped more than 7% premarket on a strong fiscal first quarter and gave technology another name to trade. Dow futures are up 299 points or 0.6%. S&P 500 and Nasdaq-100 futures both gained 0.6%.

The oil retreat is a one-session move against a trend that drove four straight days of selling. Treasury yields have not followed crude lower. The Consumer Price Index at 12:30 GMT is the last inflation report before the Fed’s September 16 rate decision.

Daily September E-mini S&P 500 Index Technical Analysis

September E-mini S&P 500 Index futures are edging higher shortly before the cash market opening on Friday. The main trend is down according to the daily swing chart. The downtrend was reaffirmed on Thursday when sellers took out the previous swing bottom at 7,618.50. On Thursday, the index also closed on the weak side of the 50-day moving average at 7,633.81. However, there wasn’t any follow-through to the downside as expected. New buyers then stepped in to drive the index back to the strong side of the 50-day MA where it currently sits.

The intermediate range is 7,324.00 to 7,838.50. Its retracement zone sits at 7,581.25 to 7,520.50. This is a key retracement zone that value seekers may be eyeing. Yesterday’s low at 7,585.50 stopped just above the retracement zone.

If a new range forms between 7,766.50 and 7,585.50, then its 50% level at 7,676.00 will become the first upside target. The momentum needed to reach this level could be fueled by a clean breakout over the 50-day MA.

Crude Pulled Back but the Week’s Damage Is Done

WTI dropped 3.3% Friday morning to $99.08. Brent fell 3.6% to $103.76. Crude is still up around 8% on the week. The retreat gave stock futures a lift after a week where oil above $100 repriced Treasury yields and pushed rate-hike odds above 70%. The Dow is heading toward a 2.5% weekly loss. The S&P 500 and Nasdaq are both down about 1.6%.

Core CPI at 0.2% Is the Estimate

Economists expect headline CPI to rise 0.4% in August with the annual rate near 3.4%. Core CPI excluding food and energy is expected at 0.2% monthly and 2.4% year over year. The report is the last major inflation read before the September 16 Fed decision.

The August data covers the period before the latest crude surge above $100. The tanker attacks and the Houthi port seizure from this week are not in the numbers. The Fed has to weigh August’s backward-looking CPI against a real-time energy market that repriced the entire inflation outlook this week.

Oracle Jumped 7% on AI Numbers

Oracle shares rose more than 7% in premarket after delivering a strong fiscal first quarter. The company raised its earnings and revenue forecasts. The AI business delivered 850 megawatts of compute during the quarter, three times the amount delivered in the entire fourth quarter. Oracle also added more than $30 billion in new AI contracts.

JPMorgan and KeyBanc focused on better execution and stronger bookings. Morgan Stanley pointed to pressure on gross margins and only a modest increase in 2027 earnings-per-share guidance. Data-center timing is still a question.

Friday morning, buyers are looking past the margin concern. Oracle is giving the Nasdaq a stock-specific catalyst at a point in the week where the index needs one.

Treasury Yields Have Not Followed Oil Lower

The 10-year was near 4.94% Friday morning after jumping 11 basis points Thursday to its highest since October 2023. The 30-year was near 5.36%. The 2-year held around 4.56%.

Oil pulled back. Yields did not. The CPI reaction in Treasuries is what stock traders need to see Friday. If yields fall after the report, the morning futures rally has legs. If yields hold near the highs on a soft number, Friday’s bid has a problem underneath it.

What to Watch

The Consumer Price Index at 12:30 GMT decides whether the bond market gives any of the week’s yield surge back. The August CPI data predates the $100 crude surge and the bond market has already repriced for it. Oracle gave technology a bid Friday morning. The AI numbers were strong enough to draw buyers into the premarket. The Nasdaq needs more than one name to recover the week’s losses but Oracle at 7% is real support underneath the index ahead of the data.

The bias stays bearish with the S&P 500 trend down on the swing chart. Thursday reaffirmed the downtrend on a break of 7,618.50 but sellers did not get follow-through and buyers pushed the index back above the 50-day. The 50-day moving average at 7,633.81 is the near-term guide. A sustained move above it with the CPI cooperating targets the 50% level at 7,676.00. A failure to hold the 50-day sends the index into the retracement zone at 7,581.25 to 7,520.50. A clean break of 7,520.50 is the trigger for acceleration lower.

More Information in our Economic Calendar.