Stock Futures Waver Amid Inflation Data, Major Earnings

The consumer-price index rose 0.4%, seasonally adjusted, in September, a faster pace than in the previous month, and with a 5.4% annual rate. Economists had projected a 0.3% increase from August and a 5.3% annual rate, as labor shortages and supply-chain snarls kept prices high.  

“The Federal Reserve will be very sensitive to this number,” Antonio Cavarero, head of investments at Generali Insurance Asset Management, said. “The message the Fed might deliver on the back of an unwelcome CPI number is an indication that the normalization process will move ahead at a faster pace than previously expected.”

Stocks have been weighed down by fears about inflation in recent days, stoked by rising energy prices and continued supply bottlenecks. Investors are trying to gauge the effect this could have on central bank support for the economy and whether the higher costs for raw materials and energy will erode profits as third-quarter earnings season kicks off. 

“Equity markets need to incorporate the higher uncertainty on central banks’ approaches and the uncertainties on the earnings side,” said Mr. Cavarero. “This doesn’t mean the tide has turned, but some higher caution is probably the way to go for the next few weeks.” 

The yield on the benchmark 10-year Treasury note ticked up to 1.596% Wednesday, from 1.579% Tuesday.

Fed official Raphael Bostic said Tuesday that there was a risk of inflation being more persistent than expected and that he was on board with an imminent pullback in some stimulus measures. The Fed is expected to publish minutes from its last meeting at 2 p.m., providing investors with more insight into policy makers’ views.  

Several household-name companies reported earnings early Wednesday. BlackRock rose 2.1% in premarket trading after reporting revenue and profit that beat analysts’ expectations. JPMorgan’s earnings per share came in slightly above Wall Street’s projections, sending its shares up 0.6%.

Delta Air Lines shares slipped 1.4% after the company posted a quarterly profit but said it faced pressure from rising fuel prices.

“Have we passed the point of the sweet spot—low costs and explosive demand, to a point where demand is softening and costs are picking up? We do expect to see some signs of that starting to emerge,” said Sebastian Mackay, a multiasset fund manager at Invesco. “I do believe we’ll be in a more rocky patch for equities, where they will be moving sideways or possibly down a little bit.” 

The oil-price rally halted following a report that suggested Iran nuclear talks could recommence as soon as this week, prompting some traders to price in a potential higher supply of crude to the market. Global benchmark Brent crude edged down 0.7% to $82.81. 

Tempered demand due to the sharp rise in energy prices may also be contributing to the stabilization, according to Sebastian Mackay, a multiasset fund manager at Invesco.

“We are probably entering the stage where prices have moved up so quickly that we are now getting a demand response, people are reining in spending and that starts to balance the market a little bit,” he said.

More stable oil prices will weigh on market participants’ expectations for inflation, at least in the short term, according to Michael Hewson, a chief market analyst at CMC Markets. 

Overseas, the pan-continental Stoxx Europe 600 declined 0.5%. Among European equities, German software firm SAP rose over 4% after raising its full-year guidance late Tuesday. Man Group jumped close to 8% after the listed hedge fund reported a strong performance in the third quarter and said it expected the momentum to carry into the next quarter. 

In Asia, major benchmarks were mixed. The Shanghai Composite Index added 0.4% while Japan’s Nikkei 225 slid 0.3%. Markets in Hong Kong were closed due to a typhoon.

Write to Anna Hirtenstein at anna.hirtenstein@wsj.com