Investors on Edge: Key Inflation Report and Earnings Season in Focus

U.S. stock index futures held steady as investors prepared for a significant week, including the release of crucial inflation data, Federal Reserve Chair Jerome Powell's testimony, and the kickoff of the second-quarter earnings season. Market participants are keen on insights to better gauge the Fed's monetary policy outlook.

U.S. stock index futures were largely flat on Monday, as investors braced themselves for a pivotal week dominated by an important inflation report, Federal Reserve Chair Jerome Powell's testimony, and the onset of the second-quarter earnings season.

Friday's nonfarm payrolls report indicating a slowdown in U.S. job growth fueled expectations for potential interest rate cuts by September, with traders assigning a 70% probability to a 25 basis point cut, according to CME FedWatch data. Focus is now on Thursday's consumer price index release for June, anticipated to signal slight increases in both headline and core inflation.

The S&P 500 and Nasdaq closed at record highs on Friday, propelled by gains in tech giants like Meta Platforms and Microsoft. The upcoming earnings reports from major banks beginning July 12 and Powell's semi-annual testimonies will be closely watched for further market direction.

(With inputs from agencies.)