Economic calendar: US CPI report for September in the market spotlight 🗽

• European index futures point to a higher opening, supported by a rebound in the Chinese stock market
• U.S. index contracts gain, after the S&P 500 hit a historic high yesterday, for the 44th time this year 
• US CPI inflation for September (1:30 PM BST) in focus on Wall Street; market hopes for 2.3% y/y (lowest reading since 2021)

Investors are awaiting today's most important macro report of the week, the CPI inflation from the US. In the data, investors will want to find confirmation that, although recent macro data has fallen above forecasts, inflation is indeed falling and the Fed is correct in saying that the downward trajectory will continue until the rate reaches the 2% target.

On the other hand, a surprise rise above forecasts could worry Wall Street and suggest that the Fed will really have to 'come down' from its until recently ultra dovish narrative. A reading in line with or below forecasts could weaken the dollar and support the upward momentum on Wall Street, which is trading near historic highs. The market also expects a very modest increase in unemployment claims.

Equity markets were supported today by stimulus in China, where the People's Bank of China announced bond buying as another way to stimulate demand, while opening swap lines for financial institutions, insurers and mutual funds. Another pro-growth factor impacting stock markets today is the very strong performance of the world's largest semiconductor manufacturer, Taiwan's TSMC (TSM.US). Thanks to AI chips, September sales rose 39% year-on-year, and for the whole of Q3 by as much as 13% quarter-on-quarter, beating the upper range of the company's own forecast, which had expected 8-12% quarterly growth.

Economic Calendar

7 AM BST, CPI inflation from Norway: 3% y/y vs. 3.2% forecast and 2.3% previously (0.3% m/m vs. 0.5% forecast and -0.9% previously)

9 AM BST Industrial production from Italy: 0.2% forecasts m/m vs -0.9% previously

12:30 PM BST ECB minutes

1:30 PM BST, September CPI report from the US: 2.3% y/y forecasts vs 2.5% previous (0.1% m/m forecasts vs 0.2% previous)

• Core CPI inflation: 3.2% y/y forecasts vs 3.2% previous (0.2% m/m forecasts vs 0.3% previous)

1:30 PM BST, US jobless claims: 230k forecast vs. 226k previous

• Jobless claims continued: 1.83 million vs. 1.826 million previously

3:30 PM BST, change in US gas inventories according to EIA: 76 billion cubic feet (bcf) vs. 55 bcf previously

Central bankers' speeches

• 2:15 PM BST - Fed Cook
• 3:30 PM BST - Fed Barkin
• 4 PM BST - Fed Williams