The major U.S. index futures are currently pointing to a roughly flat open on Tuesday, with stocks likely to show a lack of direction following the weakness seen in the previous session.
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.
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.
A slump by shares of Nvidia (NASDAQ:NVDA) weighed on the markets, with the AI darling tumbling by 2.6 percent on the day.
The drop by Nvidia came amid news a Chinese regulator has launched an investigation into whether the chipmaker violated the country’s antimonopoly laws.
Traders may also have been cashing in on recent strength in the markets, which has lifted the major averages to record highs.
The weakness on Wall Street also came as traders looked ahead to the release of closely watched U.S. inflation data later in the week.
Reports on consumer and producer price inflation, which are due to be released on Wednesday and Thursday, respectively, could impact the outlook for interest rates.
Telecom stocks came under considerable selling pressure over the course of the session, dragging the NYSE Arca North American Telecom Index down by 1.7 percent.
Significant weakness was also visible among interest rate-sensitive utilities stocks, as reflected by the 1.6 percent loss posted by the Dow Jones Utilities Average.
Brokerage and banking stocks also saw notable weakness, while gold stocks moved sharply higher along with the price of the precious metal.
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