Hot spots sizzle, CPI looms
SPY•Key events to watch
Key developments that could influence markets on Wednesday:
- July CPI data for the U.S., Germany, Italy
- Q2 results for Bechtle AG, Sampo Oyj, ABN Amro Bank NV
- United Kingdom RICS Housing Survey for July
Currencies and futures reflect cautious trading
Fed rate prospects will weigh heavily on currencies, with the yen having given up much of its gains. The yen slid to 159.45 per dollar in Asian trade, the weakest since coordinated intervention between Japan and the U.S. bolstered the currency to the 155.2 level last week.
Futures pointed to a slightly lower open in European markets, with the pan-region Euro Stoxx 50 contracts STXEc1 down 0.06%. German DAX futures FDXc1 were 0.08% lower, and FTSE futures FFIc1 slid 0.25%. U.S. stock futures, the S&P 500 e-minis ESc1, were up 0.11%.
U.S. CPI expected to shape September Fed expectations
Today's consumer price index data in the U.S. won't capture the most recent rise in energy costs, but it is still likely to shape expectations for the Federal Reserve's September meeting, with money markets showing an even chance of a hike.
U.S. consumer prices are expected to have increased 0.1% last month after falling 0.4% in June, according to a Reuters poll. Annual CPI inflation is forecast to slow to 3.4% from 3.5% a month earlier.
The data follows a bad miss on U.S. payrolls last Friday, highlighting the narrow path for Fed officials in balancing support for the economy and keeping inflation in check.
