S&P 500 futures edge higher, yields fall after soft PPI

Euro STOXX 600 index futures were up about 0.2%.

The dollar slipped, while gold and U.S. crude rose slightly; bitcoin was up about 1%.

Most S&P 500 sector SPDR ETFs were higher in premarket trading, with tech leading, up about 0.7%. Healthcare was off about 0.4% and was the weakest group.

The Invesco KBW Bank ETF was up around 0.6%. The Invesco PHLX Semiconductor ETF was advancing more than 1%.

U.S. equity index futures were modestly green, with Nasdaq 100 futures up about 0.6%.

June PPI on a month-over-month basis came in at -0.3% versus a 0.0% estimate. The year-over-year print was 5.5% compared with the 6.2% Reuters poll. Ex-food/energy PPI on a month-over-month basis came in at 0.2% versus a 0.4% estimate. On a year-over-year basis, the ex-food/energy reading came in at 4.7% versus the 5.2% Reuters poll.

E-mini S&P 500 futures have strengthened slightly after the release of softer-than-expected Producer Price Index (PPI) data. The futures are now up about 0.3% versus a gain of about 0.1% shortly before the numbers came out as Fed tightening bets have been reduced.

Separately, the Mortgage Market Index was 259.1 versus 266.3 last week. The July NY Fed Manufacturing Index was 15.6 versus an 8.8 Reuters poll.

According to the CME's FedWatch Tool, the probability that the Fed leaves its current target rate of 3.50% to 3.75% unchanged at its July 28 to 29 FOMC meeting is now 89% versus 83% just prior to the release of the data. The chance that the FOMC hikes rates by 25 basis points is now 11% from 17%.

Looking further out into 2026, interest rate probabilities based on Fed funds futures are now pricing in about 27 bps of hikes through year-end versus about 33 bps shortly before the numbers were released.