Stock futures searched for direction Wednesday morning as investors looked ahead to more corporate earnings results and another batch of inflation data.

Contracts on the S&P 500 were little changed. During Tuesday's regular session, the blue-chip index rose to a record intraday high before pulling back and ending lower. Each of the Dow and Nasdaq also pulled back, with cyclical areas of the market like airline stocks and financials posting some of the biggest declines. Wednesday morning, Bank of America (BAC) shares dipped after the company became the latest major bank to post mixed second-quarter earnings results, with revenue net of interest expenses dipping 4% over last year and missing estimates amid a decline in interest rates. 

Concerns over the pace of the economic recovery were back in focus this week with the release of hotter-than-expected print on consumer price inflation, which registered the fastest annual increase since 2008 and suggested stubbornly high prices could derail the recovery. The 10-year Treasury yield moved higher following the report to break back above 1.4%. Investors are also nervously eyeing the global spread of the Delta variant of the coronavirus. 

Analysts have been split over just how transitory inflationary pressures in the market will ultimately end up being, and for how long the Federal Reserve will be able to shrug off rising prices before making a monetary policy move. Bank of America's Alexander Lin wrote in note to clients that the firm doesn't believe the consumer price index (CPI) "report changes much for the Fed," while ING economist James Knightley said the blowout inflation reading "makes it increasingly difficult for the Fed to stick to its position that elevated inflation readings are merely 'transitory.'"

Others are still firmly in the mindset that price pressures will subside later this year. And to be sure, much of the rise in the June CPI report comprised an increase in used car and truck prices and other categories consistent with an only momentary reopening-fueled surge.

"This inflation is transitory, and it will begin to pull back as we move towards the end of the year," Brent Schutte, Northwestern Mutual Wealth Management chief investment strategist, told Yahoo Finance. "There are parts of the economy that were impacted by COVID; those supply chains are still impacted. And that's what driving up the prices of certain aspects of the inflation equation." 

Investors are set to get an update on inflationary pressure further up the supply chain in the Bureau of Labor Statistics' producer price index (PPI) on Wednesday. Consensus economists are looking for the broadest measure of producer prices to have climbed by 6.7% in June over last year, marking the fastest. pace on record in data spanning back to 2010.

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