The US dollar is higher this morning but stocks are mixed before the bell. A number of key indexes on inflation, employment, and manufacturing will hit the markets today and could turn investor sentiment either way depending on the results.
About 60 minutes before the opening bell, Dow futures are down 7 points to 10,289 while futures on the S&P 500 are off 1.60 points to 1,098.
Commodities are weaker with WTI Crude oil trading 61 cents lower to $76.72 per barrel and Spot Gold down 66 cents to $1,106.15.
Meantime, the US Dollar Index is up 24 basis points to 80.61.
Key Events Today:
8:30 ― The Producer Price Index is expected to see a rapid 0.8% climb in January based on oil prices. Once energy and food prices are stripped of the equation however, the advance is supposed to be just 0.1%, providing further support that inflation should remain on the policy back burner. In the prior month the headline index rose 0.2% while the core index was flat.
“After a quiet December, the index is projected to surge as gasoline and fuel oil prices rose more than 10% during the first month of the year,” said economists at IHS Global Insight. “Markedly colder weather across much of the southern U.S. should push fruit prices higher, pulling food prices up again . . . Weak wage and salary increases, combined with low capacity utilization rates are keeping a lid on core finished goods prices.”
8:30 ― Initial Jobless Claims have been particularly volatile of late, in part because of administrative delays that have skewed the data. Last week the index dropped 43k to 440k, leading the four-week average to fall for the first time in a month. Economists have few tools to predict the weekly numbers, and given recent volatility it shouldn’t be surprising the consensus is simply flat at 440k. Forecasts range from 410k to 450k.
“We look for initial jobless claims to have fallen to 435,000 in the week ending February 13th ― the February employment survey week,” said economists at RDQ. “Major winter storms during this week increases forecasting uncertainties for initial claims.”
10:00 ― The Leading Indicators Index, a composite that attempts to track turning points in the economy, has now been growing for nine consecutive months. The December index even saw a 1.1% gain ― its fastest growth spurt in more than four years. For January, the index is expected to see a more temperate 0.5% advance.
“This month's advance should be led by: longer average working hours in the manufacturing sector; a higher vendors' performance index; and a steep yield curve. These factors should be partly offset by a rise in initial jobless claims,” said analysts from Nomura Global Economics.
10:00 ― Like its cousin survey in New York, the Philadelphia Fed Survey is expected to be in clear growth mode in February, improving slightly from levels seen in the first month of the year. The +17.0 prediction seems too optimistic compared with the New Orders component last month though, which was just +3.2.
In line with that thinking, economists from Nomura expect the index to drop 5.2 points to 10.0. “Heavy storms battered the region during the survey period and led to the temporary shutdown of many businesses,” they note. “Manufacturers in the area likely temporarily trimmed production.”
11:00 ―Treasury announces the terms of next week's auctions of 2 year notes, 5 year notes, 7 year notes, and 30 year TIPS bonds.
3:00 ― The Federal Reserve Releases the weekly MBS purchases report
5:00 ― Elizabeth Duke, governor of the Federal Reserve, speaks to the annual Economic Impact Award in Norfolk, Va.
