What is Driving the Markets Today

U.S. stock futures are trading mostly higher on Thursday, supported by positive news from chipmaker Micron. Sentiment remains fragile, however, as markets await the release of the latest U.S. inflation data. In Europe, attention is focused on a series of central bank meetings, with the Bank of England expected to be the only one to ease monetary policy.

1. U.S. futures rise with help from Micron, markets await CPI
   Futures on U.S. indices are moving mostly higher, with the technology sector supported by a strong update from Micron, just ahead of key inflation data.

Early in the morning, S&P 500 futures are higher, the Nasdaq 100 posts stronger gains, while the Dow Jones trades slightly lower. Positive expectations surrounding Micron are improving sentiment, especially after disappointing results from Broadcom and Oracle last week.

Still, markets are coming off another negative session, with the S&P 500 and Dow Jones recording a fourth consecutive day of declines. The Nasdaq Composite is the weakest performer, down nearly 2%, after Oracle shares fell sharply following news about a key investor withdrawing from a major data center project.

The focus of the economic calendar remains on U.S. consumer inflation data, which will provide further signals about the future policy of the Federal Reserve.

2. U.S. consumer inflation in focus
   Data this week show cooling in the U.S. labor market, with the unemployment rate reaching its highest level in more than four years.

Attention now turns to inflation—the second key pillar of the Fed’s mandate. Annual inflation, both headline and core, is expected to remain around 3.0%, broadly in line with the most recent report.

Overall, progress in slowing inflation toward the Fed’s 2% target appears to have stalled over the past year, with readings holding in a range between 2.3% and 3.0%. This keeps uncertainty high around future interest rate decisions.

3. Strong demand for Micron’s chips
   After weak results from companies linked to artificial intelligence put pressure on market sentiment, Micron has managed to reverse the trend by forecasting very strong results for the second quarter.

The company reports robust demand from data centers, supported by increased investment from major cloud providers. This demand is expected to persist in the coming years, with Micron’s management projecting that it will not be able to fully meet the needs of key customers at least until 2026.

Micron’s chips are a core component in servers, personal computers, smartphones, and automobiles, as well as a key element in high-speed memory used for the development of generative artificial intelligence.

4. Bank of England expected to cut rates
   Several central bank meetings are taking place in Europe, but the main focus remains on the Bank of England.

The European Central Bank is expected to leave rates unchanged, while the central banks of Sweden and Norway are also likely to stay on hold. In contrast, the Bank of England is expected to cut its key interest rate to 3.75%, amid a sharp slowdown in inflation and weakening economic growth in the UK.

Despite the recent decline, inflation in the United Kingdom remains the highest among G7 countries. Markets currently expect one more rate cut in 2026, with the probability of a second cut increasing after the latest inflation data.

5. Oil rises on tensions around Venezuela
   Oil prices are rising after the United States announced a blockade of sanctioned tankers carrying Venezuelan oil.

Brent and WTI are posting gains, supported by concerns over further supply disruptions from the OPEC member country. However, the market remains under pressure from expectations of oversupply and geopolitical factors that are limiting stronger upside.

On an annual basis, oil is on track to record one of its weakest performances in recent years, highlighting the volatile environment in commodity markets.