U.S. Stocks May Move To The Downside As Inflation Data Looms

After ending yesterday’s lackluster session mixed, stocks may move to the downside in early trading on Wednesday. The major index futures are currently pointing to a lower open for the markets, with the S&P 500 futures down by 0.3 percent.

Traders may look to cash in on some of the recent strength in the markets ahead of the release of closely watched readings on consumer price inflation on Thursday.

The inflation readings, which are said to be preferred by the Federal Reserve, are expected to show the annual rate of consumer price growth slowed to 2.4 percent in January from 2.6 percent in December.

The annual rate of growth by core consumer prices, which exclude food and energy prices, is also expected to dip to 2.8 percent in January from 2.9 percent in December.

With Fed officials saying they need greater confidence inflation is slowing before they consider cutting interest rates, the data could have a significant impact on the outlook for rates.

Revised data released by the Commerce Department this morning showed the U.S. economy grew by slightly less than previously estimated in the fourth quarter of 2023.

The Commerce Department said the jump by real gross domestic product in the fourth quarter was downwardly revised to 3.2 percent from the previously reported 3.3 percent. Economists had expected the surge in GDP to be unrevised.

Meanwhile, the report said the increase in consumer prices in the fourth quarter was upwardly revised to 1.8 percent from 1.7 percent, while the increase in core prices was upwardly revised to 2.1 percent from 2.0 percent.

Following the modest pullback seen during Monday’s session, stocks showed a lack of direction over the course of the trading day on Tuesday. The major averages bounced back and forth across the unchanged line before eventually ending the day mixed.

While the Nasdaq climbed 59.05 points or 0.4 percent to 16,035.30 and the S&P 500 edged up 8.65 points or 0.2 percent to 5,078.18, the Dow dipped 96.82 points or 0.3 percent…