(Reuters) -U.S. stock index futures rose on Tuesday ahead of data that is expected to show consumer prices cooled in May, likely supporting bets that the Federal Reserve could skip raising interest rates this month.
The U.S. Labor Department's consumer price index (CPI) reading, due at 8:30 a.m. ET, is expected to show inflation rose 0.2% last month compared with a 0.4% jump in April, with core inflation likely to have remain unchanged at 0.4%.
The Fed will commence its two-day policy meeting later in the day, with an interest rate decision due on Wednesday, followed by Chair Jerome Powell's news conference.
Traders see a nearly 80% chance that the central bank will hold interest rates at the 5%-5.25% range, while pricing in an almost 60% chance of a 25-basis-point hike in July, according to the CME Fedwatch tool.
"We expect a further deceleration in both the headline and core indices. This, in turn, might convince investors that the FOMC will likely announce a pause on rates tomorrow," UniCredit analysts said.
"However, the market has certainly not rejected the possibility of a last rate hike in either July or September."
The S&P 500 and the Nasdaq logged their highest closing levels since April 2022 on Monday, lifted by market heavyweights including Amazon.com, Apple and Tesla.
The benchmark S&P 500 has risen 21% from its October 2022 lows, heralding a bull market according to some investors.
At 6:58 a.m. ET, Dow e-minis were up 6 points, or 0.02%, S&P 500 e-minis were up 4.5 points, or 0.1%, and Nasdaq 100 e-minis were up 41.25 points, or 0.28%.
Oracle Corp jumped 4.9% premarket as the software firm topped quarterly revenue estimates and forecast an upbeat current quarter, while Intel Corp gained 1.5% after the chipmaker entered in talks with SoftBank Group Corp's Arm to be an anchor investor in its initial public offering (IPO).
Apple slipped 0.8% after UBS downgraded the iPhone maker to "neutral" from "buy".
Advanced Micro Devices rose 1.8% ahead of unveiling details about its "AI Superchip".
Bunge Ltd slipped 2.5% after the U.S. grains merchant and Glencore-backed Viterra announced an $18 billion merger deal, including debt.
U.S.-listed shares of Chinese companies including JD.com , Alibaba Group, Baidu Inc and Netease Inc rose between 2.2% and 4.7% after China's central bank lowered a short-term lending rate for the first time in 10 months.
(Reporting by Shristi Achar A and Sruthi Shankar in BengaluruEditing by Vinay Dwivedi)
