(Reuters) - U.S. stock index futures dipped on Wednesday, with investors pricing in greater odds of Democrat Kamala Harris prevailing in the upcoming presidential elections, while focus moved to a key inflation reading later in the day.
Investors have for weeks been adjusting their expectations around the Federal Reserve's policy meeting next week and the inflation data could feed into those. But the U.S. presidential debate, in which Harris put her Republican rival Donald Trump on the defensive late on Tuesday, was driving sentiment, analysts said.
Wall Street remained on edge as the debate offered investors little clarity on key policy issues, even as betting markets swung in Harris' favor after the event.
"Relative to Trump, we see Harris' policies as less fiscally expansionary, less focus on tax cuts," noted Jefferies' chief Europe economist Mohit Kumar.
After the debate, pricing for a Trump victory slipped by 6 cents to 47 cents on online betting site PredictIt, while climbing to 57 cents from 53 cents for a Harris win.
Shares of Trump Media & Technology Group, Trump's media firm, slid 15.2% in premarket trading.
Yields on U.S. government bonds fell across the curve, with the yield on the 10-year note last at 3.6068%, its lowest level in more than a year.
Other traditional safe-haven assets such as the Japanese yen and Swiss franc also rose, while the dollar index came under pressure.
Later in the day, focus will be on a reading of August consumer price inflation (CPI), with headline inflation expected to ease to 2.6% year-on-year, while the "core" figure, which excludes volatile components like food and energy, is expected to remain unchanged at 3.2% annually.
This will be followed by the producer prices report on Thursday.
Traders are all but convinced that the Fed will cut interest rates when it meets on Sept. 17-18, with 67% tilted toward a 25-basis point cut, according to CME's FedWatch Tool.
The S&P 500 and the Nasdaq closed higher in choppy trading on Tuesday, while the Dow ended lower as losses in big banks such as Goldman Sachs weighed.
At 05:22 a.m. ET, Dow E-minis were down 186 points, or 0.46%, S&P 500 E-minis were down 20.75 points, or 0.38%, and Nasdaq 100 E-minis were down 80.75 points, or 0.42%.
Among other stocks, GameStop dropped 10.8% after the videogame retailer, which has been at the center of a "meme stock" frenzy, said it had filed for an offering of up to 20 million shares and reported lower second-quarter revenue.
Cryptocurrency and blockchain-related stocks slipped as bitcoin, the world's largest cryptocurrency, fell more than 1%.
Exchange operator Coinbase Global lost 2.7%, software firm MicroStrategy eased 3.9% and crypto miner Riot Platforms fell 2.1%.
(Reporting by Shashwat Chauhan in Bengaluru; Editing by Shounak Dasgupta)