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September CPI data higher than expected

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Delta Air Lines ( DAL ) down after Q3 results

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Futures down: Dow 0.26%, S&P 500 0.37%, Nasdaq 0.52%

(Updated at 8:50 a.m. ET/1250 GMT)

By Lisa Pauline Mattackal and Pranav Kashyap

Oct 10 (Reuters) -

Wall Street futures extended losses on Thursday after data

showed U.S. inflation was higher than expected in September,

keeping the Federal Reserve on track to ease interest rates by

25 basis points at its next meeting.

The closely watched

Consumer Price Index

rose 0.2% on a monthly basis and 2.4% on an annual basis,

with both figures being slightly higher than estimates by

economists Reuters polled.

The core figure, which excludes volatile food and energy

prices, rose 3.3% year-over-year, versus an estimated 2.3%.

Dow E-minis were down 112 points, or 0.26%, S&P

500 E-minis were down 21.5 points, or 0.37% and Nasdaq

100 E-minis were down 106.25 points, or 0.52%.

After the inflation data was released, traders firmed

bets on a 25-bps cut in November at 85%, with a 15% chance of no

change at all, according to CME's FedWatch.

"The market's reacting because you're pricing out the

possibility of big Fed rate cuts and the risk that the Fed isn't

going to be as supportive to markets," said Cameron Dawson,

chief investment officer at NewEdge Wealth.

However, weekly jobless claims also rose to 258,000 for

the week ending Oct. 5, versus an estimate of 230,000.

"The CPI data coming in hotter than expected, and at the

same time initial jobless claims really picked up, is certainly

a confusing message for markets," Dawson said.

"Whether or not that means the Fed is going to be able

to deliver the full extent of its expected interest-rate cuts is

a good question."

Meanwhile, Delta Air Lines ( DAL ) lost 1.2% after

forecasting quarterly revenue below expectations in anticipation

of slower travel spending.

Other airlines also lost ground, with United Airlines

down 1.1%, American Airlines ( AAL ) losing 1% and

Southwest Airlines ( LUV ) slipping 0.8%.

Equity market performance has been largely led by

expectations for easing monetary policy, with traders now

scrutinizing how much further the central bank will lower

borrowing costs this year.

Among other single movers, shares of Pfizer ( PFE ) fell

1.3% as former executives distanced themselves from activist

investor Starboard's campaign against the drugmaker.

Both the S&P 500 and the Dow notched up record

closing highs on Wednesday, after minutes from the Federal

Reserve's last meeting showed a "substantial majority" of

policymakers had favored September's outsized 50-basis-point

rate cut.

The start of the third-quarter earnings season is also

in focus, with major banks scheduled to report results on

Friday. Their results will be key in ascertaining if the recent

equity rally is sustainable.

The third-quarter earnings growth rate for the S&P 500

is estimated at 5% year-over-year, according to estimates

compiled by LSEG.

Apart from earnings, investors are grappling with rising

Treasury yields - the benchmark 10-year Treasury note yield is

trading around its highest since late July - along with the

impact of the Middle East conflict on oil prices and the

upcoming U.S. presidential election.

Investors were also monitoring the impact from Hurricane

Milton, which made landfall on Florida's west coast late on

Wednesday.