U.S. Stocks May Lack Direction Ahead Of Consumer Price Inflation Data

(RTTNews) - Stocks may show a lack of direction in early trading on Tuesday following the weakness seen in the previous session. The major index futures are currently pointing to a roughly flat open for the markets, with the S&P 500 futures up by less than a tenth of a percent.

Traders may be reluctant to make significant moves ahead of the release of the Labor Department's closely watched report on consumer price inflation on Wednesday.

The report is expected to show consumer prices rose by 0.2 percent for the fifth straight month in November, while the annual rate of consumer price growth is expected to tick up to 2.7 percent in November from 2.6 percent in October.

Core consumer prices, which exclude food and energy prices, are expected to increase by 0.3 percent for the fourth straight month in November. The annual rate of growth by core consumer prices is expected to remain at 3.3 percent.

While the Federal Reserve is widely expected to lower rates by another 25 basis points next week, the data could impact the outlook for future rate cuts by the central bank.

The Labor Department released a report this morning showing the jump by U.S. labor productivity in the third quarter was unrevised from the previous estimate, although it also showed a downward revision to the increase by U.S. unit labor costs.

The report said labor productivity shot up by 2.2 percent in the third quarter, unrevised from the initial estimate and in line with economist estimates.

The sharp increase in labor productivity in the third quarter reflects a modest acceleration from the 2.1 percent surge in the second quarter.

Meanwhile, the Labor Department said the increase in unit labor costs in the third quarter was downwardly revised to 0.8 percent from the 1.9 percent jump originally reported. Economists had expected the pace of unit labor cost growth to be unrevised.

Revised data also showed unit labor costs slumped by 1.1 percent in the second quarter compared to the previously reported 2.4 percent spike.

After showing a lack of direction early in the session, stocks moved mostly lower over the course of the trading day on Monday. The major averages all moved to the downside, with the Nasdaq and the S&P 500 pulling back off last Friday's record closing highs.

The major averages finished the day firmly in negative territory. The Dow fell 240.59 points or 0.5 percent to 44,401.93, the Nasdaq slid 123.08 points or 0.6 percent to 19,736.69 and the S&P 500 declined 37.42 points or 0.6 percent to 6,052.85.

In overseas trading, stock markets across the Asia-Pacific region turned in a mixed performance during trading on Tuesday. While Japan's Nikkei 225 Index rose by 0.5 percent, Hong Kong's Hang Seng Index fell by 0.5 percent.

Meanwhile, European stocks have moved mostly lower on the day. The French CAC 40 Index is down by 0.8 percent and the U.K.'s FTSE 100 Index is down by 0.6 percent, although the German DAX Index is just above the unchanged line.

In commodities trading, crude oil futures are slipping $0.22 to $68.15 a barrel after jumping $1.17 to $68.37 a barrel on Monday. Meanwhile, after surging $26.20 to $2,685.80 an ounce in the previous session, gold futures are climbing $12.30 to $2,698.10 an ounce.

On the currency front, the U.S. dollar is trading at 151.66 yen compared to the 151.21 yen it fetched at the close of New York trading on Monday. Against the euro, the dollar is valued at $1.0523 compared to yesterday's $1.0554.