US stock futures rise as strong data clears economic fears

Investing.com-- U.S. stock index futures rose in evening deals on Thursday as Wall Street saw extended gains after strong retail sales and jobless claims data helped ease concerns over an economic slowdown. 

Soft inflation data released earlier in the week furthered bets that the Federal Reserve will cut interest rates in September, adding to the positive sentiment. 

S&P 500 Futures rose 0.2% to 5,576.25 points, while Nasdaq 100 Futures rose 0.2% to 19,624.75 points by 19:22 ET (23:22 GMT). Dow Jones Futures rose 0.2% to 40,746.0 points. 

Retail sales, jobless claims beat expectations 

Retail sales data for July read stronger than expected, driving up hopes that consumer spending remained resilient.

This was coupled with data showing a smaller-than-expected number of jobless claims last week, which showed that the labor market also remained strong. 

The readings helped further dispel concerns that a U.S. recession was imminent- concerns that had battered Wall Street last week. 

But not all data read positive. Industrial production shrank much more than expected in July, amid a global slowdown in manufacturing.

25 bps rate cut seen in September

But the strong economic readings furthered the notion that the Federal Reserve will not need to cut interest rates by a big margin to boost the economy.

Inflation data released earlier the week saw traders pivot into pricing in a 25 basis point cut in September,  from earlier bets that a 50 bps cut was more likely, CME Fedwatch showed.

This shift became apparent especially after consumer price index inflation data released on Wednesday. While year-on-year CPI eased slightly more than expected, inflation still rose from last month. 

Still, persistent signs of easing inflation should give the Fed enough headroom to begin cutting rates from the coming month. A slew of other major central banks have already begun trimming rates.

Fed Chair Jerome Powell is widely expected to provide more cues on a rate cut during the Jackson Hole Symposium next week.

Wall St at two-week highs as volatility eases 

Wall Street indexes rose to two-week highs on Thursday, resuming their climb after wild swings over the past week and coming back in sight of recent record highs. 

The S&P 500 surged 1.6% to 5,543.22 points, while the NASDAQ Composite jumped 2.3% to 17,591.72 points. The Dow Jones Industrial Average rose 1.4% to 40,563.06 points.