Modest Weakness Remains Visible On Wall Street

Stocks moved to the upside at the start of trading on Thursday but came under pressure over the course of the morning. The major averages have regained some ground since then but currently remain in negative territory.

After closing high for four consecutive sessions, the tech-heavy Nasdaq is down 54.71 points or 0.4 percent at 14,914.94. The S&P 500 is also down 19.51 points or 0.4 percent at 4,763.94, while the Dow is down 113.64 points or 0.3 percent at 37,582.09.

The early downturn on Wall Street came as traders digested the Labor Department’s highly anticipated report on consumer price inflation in December, which showed prices rose by slightly more than expected.

The Labor Department said its consumer price index climbed by 0.3 percent in December after inching up by 0.1 percent in November. Economists had expected consumer prices to rise by 0.2 percent.

Excluding food and energy prices, core consumer prices still rose by 0.3 percent in December, matching the increase seen in November as well as economist estimates.

The report also showed the annual rate of consumer price growth accelerated to 3.4 percent in December from 3.1 percent in November. The annual rate of growth was expected to tick up to 3.2 percent.

Meanwhile, the annual rate of growth by core consumer prices slowed to 3.9 percent in December from 4.0 percent in November. Economists had expected the pace of core price growth to decelerate to 3.8 percent.

A number of economists have said the data makes the Federal Reserve less likely to cut interest rates in March, with many predicting the central bank will hold off until its May meeting.

“In the wake of the Federal Reserve’s dovish shift in December, financial markets had moved to price an interest rate cut as soon as March,” said ING Chief International Economist James Knightley.

“However, the tight jobs market and today’s firmer-than-expected inflation numbers suggest this is unlikely, barring an economic or financial system shock,” he added. “We…