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Futures up: Dow 0.30%, S&P 500 0.20%, Nasdaq 0.24%

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Traders price in 98% chance of 25 bps Fed rate cut in

September

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CBOE volatility index hits lowest level since January

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CoreWeave ( CRWV ) falls after larger-than-expected Q2 net loss

(Updates with analyst comment, Eli Lilly ( LLY ) drug launch)

By Johann M Cherian and Sanchayaita Roy

Aug 13 (Reuters) - Futures tracking the S&P 500 and the

Nasdaq indexes were pinned at record highs on Wednesday, buoyed

by increasing confidence that the Federal Reserve could restart

its monetary policy easing cycle next month.

Signs that U.S. taxes on imports have not fully filtered

into headline consumer prices sparked a relief rally on Wall

Street in the previous session, with the benchmark S&P 500

marking its first record high close in two weeks.

Despite core inflation marking its biggest jump since the

start of the year, investors factored in recent weakness in the

job market and a shake-up at the Federal Reserve as they leaned

in favor of a potential dovish move by the central bank in

September.

Interest rate futures now reflect a 98% chance of a 25 basis

points interest rate cut, according to data compiled by LSEG,

compared with 88.8% on Tuesday. The central bank last lowered

borrowing costs in December.

"A benign CPI report, coming on the heels of weak

non-farm payrolls, has strengthened the case for a September Fed

cut," said Nikos Tzabouras, senior market analyst at Tradu.com.

"However, market euphoria could be challenged as

stagflation risks persist, potentially eroding consumption and

hurting advertising - a key revenue stream for many tech

giants."

At 7:10 a.m. ET, Dow E-minis were up 132 points, or

0.30%, S&P 500 E-minis were up 13.25 points, or 0.20%

and Nasdaq 100 E-minis were up 58.25 points, or 0.24%.

The CBOE volatility index, popularly referred to as

Wall Street's fear gauge, dropped to 14.46 - its lowest since

January.

Rate-sensitive banking stocks such as Bank of America ( BAC )

and Citigroup ( C/PN ) were marginally higher in premarket

trading after the broader sector logged its biggest

daily rise in three months on Tuesday.

Analysts said a steepening yield curve following the

inflation report could help bank earnings as lenders could

borrow cheap and lend at a higher rate.

Later in the day, investors will scrutinize remarks of a

number of policymakers, especially Chicago Fed President Austan

Goolsbee - a Federal Open Market Committee voting member this

year.

Earnings are also in focus. CoreWeave ( CRWV ), which is

backed by Nvidia ( NVDA ), lost 8.3% after the AI data center

operator reported a bigger-than-expected quarterly net loss.

Eyes are also on developments surrounding the China

revenue-sharing deal the U.S. government signed with chipmakers

like Nvidia ( NVDA ) and Advanced Micro Devices ( AMD ), which the White

House said could be expanded to others in the sector.

Eli Lilly ( LLY ) rose 1.3% after the drugmaker

launched

the easy-to-use injector pen of its blockbuster

weight-loss drug, Mounjaro, in India.

Venture Global ( VG ) gained 8.5% after the LNG major won a

legal battle against Shell over its failure to deliver

liquefied natural gas under long-term contracts starting in

2023.

Crude prices traded around $60 per barrel ahead of a virtual

meeting between Donald Trump and European leaders on the

Russo-Ukraine conflict, two days before the U.S. president meets

Russian President Vladimir Putin.