The major U.S. index futures are currently pointing to a higher open on Tuesday, with stocks likely to regain ground following the pullback seen over the two previous sessions.
The futures advanced following the release of the Labor Department’s highly anticipated report on consumer price inflation in the month of February.
The Labor Department said its consumer price index climbed by 0.4 percent in February after rising by 0.3 percent in January. The increase matched economist estimates.
Excluding food and energy prices, core consumer prices also rose by 0.4 percent in February, matching the increase seen in January. Economists had expected core prices to rise by 0.3 percent.
The report also said the annual rate of consumer price growth ticked up to 3.2 percent in February from 3.1 percent in January. The year-over-year growth was expected to be unchanged.
Meanwhile, the annual rate of core consumer price growth slowed to 3.8 percent in February from 3.9 percent in January. Economists had expected the pace of growth to decelerate to 3.7 percent.
While core price growth slowed by slightly less than expected, the slowdown may still add to optimism about the outlook for interest rates.
Treasury yields saw considerable volatility immediately following the release of the report but have moved modestly lower since then.
After coming under pressure over the course of last Friday’s session, stocks saw further downside in early trading on Monday. The major averages regained ground as the day progressed, however, with the Dow closing modestly higher.
While the Dow inched up 46.97 points or 0.1 percent to 38,769.66 after falling nearly 240 points in early trading, the S&P 500 edged down 5.75 points or 0.1 percent to 5,117.94 and the Nasdaq fell 65.84 points or 0.4 percent to 16,019.27.
The early weakness on Wall Street came amid uncertainty about the outlook for interest rates ahead of the release of key economic data.
On Thursday, the Labor Department is due to release a separate report on producer price inflation in the month of February.
Producer prices are expected to rise by 0.3 percent in February, matching the increase seen in January, while the annual rate of producer price growth is expected to accelerate to 1.1 percent from 0.9 percent.
Reports on retail sales, industrial production and consumer sentiment are also likely to attract attention in the coming days.
Despite the recovery attempt by the broader markets, semiconductor stocks still saw significant weakness on the day, with the Philadelphia Semiconductor Index falling by 1.4 percent.
Within the sector, semiconductor equipment maker Applied Materials (NASDAQ:AMAT) slumped by 2.0 percent despite raising its quarterly cash dividend from $0.32 to $0.40 per share.
Notable weakness also remained visible among steel stocks, as reflected by the 1.2 percent loss posted by the NYSE Arca Steel Index.
On the other hand, gold stocks showed a strong move to the upside on the day, driving the NYSE Arca Gold Bugs Index up by 2.5 percent.
The rally by gold stocks came amid a modest increase by the price of the precious metal, with gold for April delivery inching up $3.10 to $2,188.60 an ounce.