U.S. stock futures traded in tight ranges Friday, with investors awaiting a key inflation report for confirmation that the Federal Reserve will cut interest rates next week.

At 05:40 ET (10:40 GMT), Dow Jones Futures slipped 18 points, or 0.1%, while S&P 500 Futures gained 11 points, or 0.2%, and Nasdaq 100 Futures rose 104 points, or 0.4%.

The main averages closed in a mixed fashion in the prior session, with the benchmark S&P 500 and tech-heavy NASDAQ Composite both advancing, while the blue-chip Dow Jones Industrial Average lagged.

All three indices have managed to eke out small gains so far this week.

PCE inflation gauge in spotlight

Expectations of 25-basis point reduction at the Federal Reserve’s December 9–10 meeting are running hot -- with futures now pricing in roughly an 87% probability -- on the back of recent weak labor data and broader signs of economic cooling.

Thursday’s weekly jobless claims plunged by 27,000 to a seasonally adjusted 191,000, the lowest level since September 2022, but economists cautioned that distortions tied to the Thanksgiving holiday may have exaggerated the decline.

Elsewhere, a private-sector payroll report from ADP on Wednesday showed a decline of 32,000 jobs -- the largest drop in over two and a half years, and a report by Challenger, Gray & Christmas stated that announced job cuts dropped sharply in November but hiring intentions remained weak.

While the importance of price stability, the second element of the Fed’s dual mandate, has faded a little of late, all eyes are now on the release of the delayed monthly core inflation gauge, the Personal Consumption Expenditures Price Index (PCE), later in the session.

This is widely seen as the Fed’s preferred inflation measure, and a soft PCE print could further embolden rate-cut expectations.

Excluding food and energy, the underlying, or "core," PCE price index is seen holding at 2.9% in the 12 months to September and 0.2% month-on-month.

Beyond PCE, the economic calendar will feature the latest survey of consumer sentiment from the University of Michigan.

Netflix linked with Warner Bros Discovery’s film assets

In the corporate sector, Netflix (NASDAQ:NFLX) has entered into exclusive negotiations to purchase Warner Bros Discovery’s (NASDAQ:WBD) film and television studios as well as its prized streaming assets, media reports have said.

The streaming giant reportedly offered $28 per share for those portions of the long-time Hollywood stalwart, whose brands include HBO and DC Comics.

Should the transaction be finalized, it would transform Netflix into a media powerhouse with control over one of the most valuable content libraries in the entertainment industry.

Netflix and Warner Bros are anticipated to announce a deal imminently, the Wall Street Journal reported, citing people familiar with the matter.

Elsewhere, Ulta Beauty (NASDAQ:ULTA) shares soared premarket after the cosmetics retailer topped Wall Street estimates for its fiscal third quarter and raised its full-year outlook.

Hewlett Packard Enterprise (NYSE:HPE) stock slumped after the cloud services and hardware company missed analysts’ revenue expectations for the fourth quarter, posting $9.68 billion versus a consensus estimate of $9.94 billion.

Crude steadies; WTI on track for weekly gain

Oil prices steadied Friday, maintaining the previous session’s gains as stalled diplomatic progress over the Ukraine war and firm expectations of a U.S. Federal Reserve rate cut supported sentiment.

Brent futures slipped 0.1% to $63.24 a barrel, and U.S. West Texas Intermediate crude futures fell 0.1% to $59.60 a barrel.

Both contracts jumped nearly 1% on Thursday, and while Brent was mostly unchanged this week, WTI was on track for a 1.5% weekly gain - a second straight week of increase.

The lack of progress in U.S.-Russia talks to end the Ukraine war has dampened hopes that energy sanctions on Russian crude could be eased soon, keeping a risk premium in the market.