Global markets surged, extending yesterday’s rally, after easing core U.S. inflation kept potential rate cuts by the Federal Reserve on the table.

Wall Street futures were mixed ahead of quarterly results from more U.S. big banks and economic reports that could offer insights into the health of the economy.

TSX futures pointed higher after Canada’s main stock market yesterday registered its biggest gain since Nov. 21.

In Canada, investors are getting results from Richelieu Hardware Ltd.

On Wall Street, markets are watching earnings from Bank of America, Morgan Stanley, PNC Financial Services Group Inc., U.S. Bancorp, UnitedHealth Group Inc. and Taiwan Semiconductor Manufacturing Co. Ltd.

Investors have been encouraged by the inflation reading, particularly since data released on Tuesday showed that U.S. producer prices had increased moderately in December.

“This report supports the view that the pricing out of rate cuts this year has gone a bit too far, and when the data turns lower again ... some extra easing will be put back on the table,” said Kyle Chapman, FX markets analyst at Ballinger Group.

Overseas, the pan-European STOXX 600 was up 0.72 per cent in morning trading. Britain’s FTSE 100 gained 0.67 per cent, Germany’s DAX rose 0.18 per cent and France’s CAC 40 advanced 1.99 per cent.

In Asia, Japan’s Nikkei closed 0.33 per cent higher, while Hong Kong’s Hang Seng rose 1.23 per cent.

Oil prices eased a day after settling at multi-month highs on the latest U.S. sanctions on Russia and a larger-than-forecast fall in U.S. crude stocks.

Brent crude futures were down 0.5 per cent to US$81.66 a barrel. West Texas Intermediate (WTO) crude futures slid 0.4 per cent to US$79.69 a barrel.

The Organization of the Petroleum Exporting Countries and its allies, which collectively as OPEC+ have been curtailing output over the past two years, are likely to be cautious about increasing supply despite the recent price rally, said Commodity Context founder Rory Johnston.

“The producer group has had its optimism dashed so frequently over the past year that it is likely to err on the side of caution before beginning the cut-easing process,” Johnston said.

In other commodities, spot gold gained 0.3 per cent to US$2,704.56 an ounce. U.S. gold futures gained 0.7 per cent to US$2,736.50.

The Canadian dollar weakened against its U.S. counterpart.

The day range on the loonie was 69.51 US cents to 69.82 US cents in early trading. The Canadian dollar was up about 0.15 per cent against the greenback over the past month.

The U.S. dollar index, which weighs the greenback against a group of currencies, was little changed at 109.12.

The euro was flat at US$1.0292. The British pound fell 0.27 per cent to US$1.2210.

In bonds, the yield on the U.S. 10-year note was last up at 4.665 per cent ahead of the North American opening bell.

Taiwan Semiconductor Manufacturing Co. has logged record quarterly profit and said it expects robust revenue growth in the first three months of the year as demand surges for chips used in artificial intelligence processing.

UnitedHealth Group has reported a fourth-quarter profit that beat analysts’ estimates as the healthcare conglomerate spent less on covering members’ medical costs.

BP has announced that it will cut around 4,700 staff, or more than 5 per cent of its total work force, as part of CEO Murray Auchincloss’s efforts to reduce costs.

With Reuters and The Canadian Press