US pre-open: Futures trade higher ahead of CPI reading

As of 1230 BST, Dow Jones futures were up 0.21%, while S&P 500 and Nasdaq-100 futures had the indices opening 0.24% and 0.30% higher, respectively.

The Dow closed 58.13 points lower on Tuesday as market participants digested more second-quarter earnings.

Wednesday's primary focus will be inflation data for July at 1330 BST, with economists expecting the US annual inflation rate to have likely slowed to 8.7% from 9.1% in June - the highest reading since November of 1981. Core inflation, on the other hand, was expected to accelerate to 6.1% from 5.9%.

CMC Markets' Michael Hewson said: "Today's main focus revolves around the question as to whether we are near peak US CPI, as markets gear up for the potential for a significant move in the event of a miss either side of the headline number?

"In June US CPI unexpectedly jumped sharply to a new 40-year high of 9.1%, prompting brief speculation that the Federal Reserve might be tempted to go for a 100bps rate move in July. While the headline number grabbed all the attention it was notable that core prices fell back from 6% to 5.9%.

"Speculation about a 100bps rate move in July didn't last very long as two of the most hawkish members of the FOMC, Waller and Bullard pushed back against the idea, saying that they felt that 75bps was sufficient, however, a similarly strong number today could prompt similar speculation about 100bps at the September meeting."

Elsewhere on the macro front, US mortgage applications edged 0.2% higher in the week ended 7 August, according to the Mortgage Bankers Association, amid a 3.5% increase in refinancing and a 1.4% drop in purchases.

Still to come, wholesale inventories data for June will be published at 1500 BST.

In terms of earnings, Spirit Airlines, Jack in the Box, Wendys and Fox Corp will report before the bell, while Walt Disney will update on its most recent trading quarter after the close.

Reporting by Iain Gilbert at Sharecast.com